London Stock Exchange ETFs in GIFT City: Could NSE IX-LSE deal expand global options for Indian mutual fund investors?

For mutual fund investors, the latest development could open up new opportunities to access London Stock Exchange (LSE)-listed ETFs through NSE International Exchange (NSE IX) in GIFT City.

According to a press release on Tuesday, NSE IFSC (NSE IX) and the London Stock Exchange signed a Memorandum of Understanding (MoU) to explore areas of strategic collaboration to drive cross-border growth and innovative listing and trading opportunities for issuers and investors in both jurisdictions.

NSE IX, set up in GIFT City in 2017 and recognised by the International Financial Services Centres Authority (IFSCA), is a multi-asset exchange offering products such as derivatives, depository receipts and global stocks.

The MoU establishes a broad framework for collaboration, including exploring dual and cross-listings across products such as equities, fixed-income securities and ETFs. Cross-listing allows a security to be listed on exchanges in more than one market or country. Here’s what this could mean for mutual fund investors.

Could LSE-listed ETFs eventually be listed on NSE IX in GIFT City?

Shweta Rajani, Associate Director at Anand Rathi Wealth, said the recent MoU between NSE International Exchange and the London Stock Exchange is an important step towards deepening India’s access to global capital markets through GIFT City.

“For investors, it creates the possibility of accessing a wider range of international products, including equities, fixed-income securities and ETFs, through the IFSC ecosystem,” she added.

For Indians, access to NSE IX products requires opening a trading and demat account with an authorised IFSC intermediary, completing the applicable KYC and regulatory requirements and funding the account through Liberalised Remittance Scheme limits and other RBI requirements, Rajani mentioned.

Under the LRS, resident individuals can remit up to $250,000 in a financial year for permitted transactions, including eligible overseas investments.