The government has taken a significant step to attract more companies to list on the international exchanges within its International Financial Services Centres (IFSCs) by reducing the minimum public float requirement to 10 per cent.

This move is part of broader efforts to align Indian regulatory standards with global practices and facilitate cross-border capital flows.

The Department of Economic Affairs has amended the Securities Contracts Regulation Rules (SCRR), 1956, to lower the public float requirement from 25 per cent to 10 per cent. This reduction is expected to make it more attractive for Indian start-ups and technology companies to tap into international markets and raise capital.

The Gujarat International Finance Tec City (GIFT City) at Gandhinagar, India’s
first IFSC, is expected to benefit significantly from these changes.

“This initiative underscores the government’s commitment to providing an agile and world-class regulatory and business environment in the IFSCs, thereby strengthening India’s position in the global financial system,” a government statement said.

Nangia Andersen India director (regulatory) Mayank Arora said: “While companies consider multiple factors such as liquidity, cost of listing, regulatory environment, etc., this amendment would certainly nudge companies (both foreign and domestic) to explore the option of listing on stock exchanges located in International Financial Services Centres (IFSCs),” he said.

The continuous listing requirement has also been set at 10 per cent, as outlined under SCRR.

Green bonds

The Reserve Bank on Thursday introduced a scheme to permit foreign investors in the International Financial Services Centre (IFSC) to invest in sovereign green bonds to facilitate wider non-resident participation in such instruments.

The government issued sovereign green bonds (SGrBs) in January 2023.

SGrBs were also issued as part of the government borrowing calendar in 2023-24.