Bombay Stock Exchange (BSE), Asia’s oldest stock exchange, will establish an international exchange in GIFT SEZ-IFC, a multi-services Special Economic Zone (SEZ) being developed as India’s first International Financial Services Centre (IFSC) by Gujarat International Finance Tec-City, popularly known as GIFT.
BSE signed a memorandum of understanding (MoU) with GIFT SEZ ltd, a wholly-owned subsidiary of GIFT at the Vibrant Gujarat Global Summit on Monday. BSE intends to develop an international exchange providing electronic platform for facilitating trading, clearing and settlement of securities, commodities, interest rates, currencies, other classes of assets and derivatives by International investors in GIFT SEZ-IFSC in GIFT City subject to necessary approvals and operating guidelines for International Financial Centre.
As per the MoU, BSE along with its associates and members will invest up to Rs 150 crore for establishing up to a 3 lakh square feet built-up area (BUA) to set up this International Exchange. GIFT SEZ has been notified as an International Financial Services Centre by Government of India as India’s first International Financial Centre.
In the absence of an IFSC in India, India has lost roughly 50 per cent market share in the two most important India-related products: with Rupee and Index being mostly traded on foreign platforms instead of onshore trading in such products. For instance, the trading volume of the rupee and India-based indices is estimated at over $100 billion a day.
“BSE’s International Exchange at GIFT City is a major step in making India’s first IFSC into a Global Financial Hub. Our aim is to make GIFT at or above par with globally benchmarked financial centres such as Shinjuku-Tokyo, lujiazui-Shanghai, la Defense-Paris and london Dockyards,” said Ramakant Jha, MD & Group CEO of GIFT.
Earlier, BSE Brokers’ Forum, the association of BSE brokers, entered into an agreement with GIFT City for setting up their operations and shifting their back-end operations in the domestic finance enclave. BSE Brokers’ Forum has been allotted 4.5 lakh square feet of Development Rights with total investment expected at around Rs200 crore.
Gujarat International Finance Tec-City (GIFT), a Government of Gujarat Project in partnership with Il&FS, is India’s First Global Financial Hub. GIFT is India’s first multi-service SEZ with International Financial Service Centre (IFSC) status.