Team Blitz India
US stock exchange Nasdaq has held talks with Indian officials on potentially allowing Indian companies to list directly on foreign stock exchanges, a senior Nasdaq executive said.
Indian companies are at present not permitted to list their shares directly on overseas markets, but global investors and top Indian startups have been calling for this to change.
Allowing Indian companies to list abroad on exchanges like Nasdaq will give them wider access to capital, Nasdaq’s Executive Vice Chairman Edward Knight said in an interview to Reuters. Knight was speaking on the sidelines of a conference near Gujarat International Finance Tec-City (GIFT), where Prime Minister Narendra Modi is seeking to attract foreign investment, months before a re-election bid.
“We are hopeful that when they (rules) are finally promulgated it will facilitate listing of companies not only here in GIFT city but also other jurisdictions,” Knight said.
He said Nasdaq held talks in October with Finance Minister Nirmala Sitharaman and market regulator SEBI Chairperson Madhabi Puri Buch, and asked them if foreign listings could be allowed beyond GIFT, and that foreign bourses should not be excluded from the policymaking.
“Those companies that have interest in reaching out to global investors, particularly companies in technology area, those companies should be allowed to do so,” he said. The GIFT City project, launched in Gujarat in 2011, aims to become a major international financial hub, where Indian companies can access the global capital markets and investors. Indian companies cannot list shares directly on GIFT’s tax neutral International Financial Services Centre (IFSC) as regulations are yet to be finalised.
In October, corporate affairs ministry had made changes to the law that could pave the way for businesses to list overseas directly, but specific details have not yet been made public.
Sources familiar with the process have said the government wants to give the go-ahead for listings on the IFSC first and that direct listings on foreign exchanges will not be allowed initially.