Introduction: The International Financial Services Centres Authority (IFSCA) plays a pivotal role in shaping India’s financial landscape, specifically within International Financial Services Centres (IFSCs). As of now, the Gujarat International Finance Tech-City (GIFT City) stands as India’s maiden IFSC. Recently, IFSCA has taken a significant step towards establishing GIFT-IFSC as an international currency trading hub by forming an Advisory Committee on Currency Derivatives.
Detailed Analysis: IFSCA’s move to set up the Advisory Committee showcases a strategic vision to expand the market for exchange-traded currency derivatives. Chaired by Shri Gurumoorthy Mahalingam, a former Whole Time Member of SEBI, the committee brings together industry experts and leaders. These include executives from IFSCA, Goldman Sachs, IndusInd Bank, Share India Securities Ltd, Deutsche Equities India Private Limited, ICICI Bank Ltd, NSE IFSC Limited, and other key players.
The Committee’s Terms of Reference (ToR) reflect a comprehensive agenda. It encompasses a review of global currency derivatives markets, identification of best practices, benchmarking IFSC ecosystem with developed markets, and addressing challenges and opportunities in exchange-traded currency derivatives. Importantly, the Committee aims to widen the investor base, analyze contract designs, and recommend policy measures for market safety, efficiency, and transparency.
The focus on a robust regulatory framework for currency derivatives in IFSC aligns with the broader objective of positioning GIFT-IFSC as a Global Currency Trading Hub. Lessons learned from global jurisdictions, international best practices, and the examination of new products contribute to a holistic approach.
Conclusion: The constitution of the Advisory Committee by IFSCA marks a significant stride towards achieving GIFT-IFSC’s ambitions of becoming a prominent international currency trading hub. The collaboration of industry stalwarts under the guidance of Shri Gurumoorthy Mahalingam reflects a commitment to excellence. As the Committee delves into its ToR, the future holds the promise of a strengthened and globally competitive exchange-traded currency derivatives market within GIFT-IFSC.
February 16, 2024 – GIFT City, Gandhinagar
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INTERNATIONAL FINANCIAL SERVICES CENTRES AUTHORITY
PRESS RELEASE
Constitution of an Advisory Committee on Exchange traded Currency
Derivatives
1. The Government of India has established the International Financial Services Centres Authority (IFSCA) with a mandate to develop and regulate financial services, financial products and financial institutions in the International Financial Services Centres (IFSCs) in India. At present, the Gujarat International Finance Tech-City (GIFT City) at Gandhinagar is the maiden IFSC in India.
2. IFSCA is a unified regulator for capital markets, banking, insurance and pension verticals in GIFT-IFSC. IFSCA has put in place the regulatory framework comparable with existing best offshore jurisdictions.
3. There are various products available for trading on the Stock Exchanges in IFSC which include the Equity Index Derivatives, Single Stock Futures, Bonds, Currency Derivatives and Depository Receipts.
4. In order to develop the market for Exchange traded currency derivatives and to make GIFT-IFSC an international currency trading hub, IFSCA has constituted an Advisory Committee on Currency Derivatives.
5. The Advisory Committee will be chaired by Shri Gurumoorthy Mahalingam, Former Whole Time Member, SEBI. The members of the Committee are as follows:
| S. No. | Details of Committee Members | Capacity |
| 1 | Shri Gurumoorthy Mahalingam, Former Whole Time Member, SEBI |
Chairperson |
| 2 | Shri Pradeep Ramakrishnan, Executive Director, IFSCA |
Member |
| 3 | Shri Arjun Nagpal, Managing Director, Goldman Sachs, Singapore |
Member |
| 4 | Shri Siddharth Banerjee, Executive Vice President at IndusInd Bank |
Member |
| 5 | Shri Sachin Gupta, CEO & Whole-Time Director, Share India Securities Ltd |
Member |
| 6 | Shri Naveen Mathur, Director, Anand Rathi International Ventures (IFSC) Pvt Ltd |
Member |
| 7 | Shri Elwin Jose, Head of Product, Listed Derivatives and Markets Clearing, Deutsche Equities India Private Limited |
Member |
| 8 | Shri Sravan Kumar V, Head Derivative Products, ICICI Bank Ltd |
Member |
| 9 | Shri V. Balasubramaniam, MD and CEO, NSE IFSC Limited |
Member |
| 10 | Shri Praveen Kamat, General Manager, IFSCA | Member Secretary |
6. The Terms of Reference (ToR) of the Committee are as under:
i. To review the developments in the currency derivatives market in key global jurisdictions and identify lessons and best practices
ii. To study the international best practices for bench-marking the IFSC ecosystem in currency derivatives with developed markets.
iii. To understand the existing challenges and opportunities in exchange traded currency derivatives in IFSC and recommend enabling policy measures
iv. To make recommendations for widening the investor base in currency derivatives on the Stock Exchanges in IFSC
v. To examine issues related to contract designs and new products in currency derivatives
vi. To recommend measures for improving market safety, efficiency, transparency and integrity and reducing cost of transaction
vii. To make recommendations for robust regulatory framework for currency derivatives in IFSC to enable GIFT IFSC to emerge as a Global Currency Trading Hub.
viii. Any other matter related to exchange traded currency derivatives in IFSC
February 16, 2024
GIFT City, Gandhinagar
