INSUBCONTINENT EXCLUSIVE:
Kolkata: The National Stock Exchange (NSE) is hopeful of consolidating trading volume at its subsidiary NSE IFSC Exchange in Gujarat's GIFT
City in the long term even as it awaits the outcome of offshore derivative tussle with the Singapore Exchange, a top official has said.
"We
have received Commodities Futures Trading Commission (CFTC) nod for NSE and in a few months, we will get a nod for NSE IFSC in GIFT City,"
NSE managing director CEO Vikram Lamaye told PTI.
Although, it is believed to encourage overseas investors, Lamaye said this should not
come in the way of people being able to trade in Gujarat International Finance Tec-City (GIFT City).
He said it takes time to build
liquidity but the bourse is actively working with investors to encourage them to trade in GIFT City, a financial Special Economic Zone.
In a
move to curb shifting of volumes to overseas markets after the imposition of long-term capital gains tax (LTCG), both NSE and BSE have
decided to stop giving data to bourses in Singapore and Dubai.
In the offshore markets, NSE's Nifty is traded in Singapore bourse and BSEs
Sensex is traded on the Dubai Gold and Commodity Exchange (DGCX).
The Nifty is the worlds largest traded derivative index in the off-shore
market and a top volume generator on the Singapore Exchange (SGX) and reportedly generates 10 per cent of its volume.
In this backdrop, the
Singapore bourse was planning to start its own derivative products based on publicly available settlement prices of Nifty futures
contracts.
It was to migrate all existing client contracts on the SGX Nifty Futures to the new SGX India Futures from June
However, after NSE got an injunction from court, SGX had decided to continue offering NSE-licensed Nifty contracts until August 2018, when
agreement between the two bourses comes to an end.
"Nifty is also available at NSE IFSC and offers all benefits required for overseas
investors, be it Dollar denominated contracts, taxation benefits and compliance are similar to any offshore trading destination available at
GIFT City," he said.
NSE was waiting for the outcome of the tussle with SGX before it takes further steps to lure overseas investors to keep
offshore trading basket vibrant.
"Let's wait for the outcome of SGX case as they hold a lot of offshore funds," Lamaye said.
BSE also
proposes to seek approval from Commodities Futures Trading Commission (CFTC) of the US to attract American investors to the GIFT City.
