India has been trying to attract foreign investors to the city that offers close to zero tax, top-notch infrastructure, and dollar contracts. SGX and NSE had been locked in a quarrel since 2018 after NSE decided to block SGX’s launch of a set of innovative Indian derivative products. In any case as everything arranged up, India’s National Stock Exchange (NSE) and Singapore Exchange Ltd (SGX) have settled for a derivatives tie-up and ended negotiation proceedings relating to a 2018 dispute on SGX’s launch of an index derivative.
The tie-up targets to bring trading of the SGX’s Nifty futures contract based on NSE’s blue-chip Nifty 50 index. This has been given to GIFT City which is an international financial center in western India. Both the bourses received regulatory approval for the collaboration last year which subsequently led to the discussions that had been carrying on for months.
Both of the exchanges said the deal aims to create a large pool of liquidity for Nifty products and to boost activities at GIFT City. India has been trying to attract foreign investors to the city that offers close to zero tax, top infrastructure, and dollar contracts.
NSE Chief Executive Officer Vikram Limaye said that the association will widen the domestic and international participant base and further strengthen the capital market ecosystem in Gift city. SGX and NSE had been locked in a quarrel since 2018 after NSE decided to block SGX’s launch of a set of new Indian derivative products on grounds that the offerings infringed its intellectual property rights.
The dispute between Singapore and India’s exchanges came to the front in February 2018. At that time NSE together with other Indian markets said that they would end all licensing agreements with foreign bourses to decrease offshore trading. The two bourses again resumed talks in July which resulted in the proposal of a cross-border trading link for nifty 50 index derivatives.
The exchanges received a set of approved regulatory dispensations from their statutory regulators for the connection in last year. The launch date for the new NSE IFSE-SGX Connect is yet to be decided. SGX will work with NSE and stakeholders to build up a connectivity infrastructure as per the exchange’s Chief Executive Officer Loh Boon Chye said in the statement.
