NSE IFSC Ltd (NSEIX) and London Stock Exchange plc (LSE) have signed a memorandum of understanding (MoU) to explore strategic collaboration in cross-border listings, trading connectivity, and the development of new financial products, aiming to strengthen capital market links between India and the UK.
Exchanges to explore dual, cross-listings
The agreement provides a framework to explore dual and cross-listings across equities, fixed-income securities and exchange-traded funds (ETFs). The two exchanges will also examine opportunities to facilitate trading in existing financial products and develop new instruments, including derivatives listed on NSEIX using FTSE Russell indices as underlying benchmarks.
Other areas of potential collaboration include the joint development of equity indices, cross-border trading connectivity and market data distribution, the exchanges said in a joint announcement.
India-UK trade pact provides backdrop
The agreement comes against the backdrop of the India-UK Comprehensive Economic and Trade Agreement (CETA), which aims to create opportunities for greater integration between the two countries' financial services industries and capital markets.
V. Balasubramaniam, managing director and CEO of NSEIX, said the MoU marks an initial step towards facilitating dual and cross-listings across products and exploring cross-border connectivity between the exchanges.
He said the proposed collaboration could enable seamless two-way trading opportunities, improve liquidity and expand the investor base. NSEIX's position in the GIFT International Financial Services Centre (IFSC) ecosystem and the London Stock Exchange's established presence in the UK market could help both exchanges leverage their respective strengths, he added.
LSE sees new growth opportunities
Dame Julia Hoggett, CEO of London Stock Exchange plc and head of digital and securities markets at London Stock Exchange Group (LSEG), said the exchange had a strong track record of building partnerships with exchanges globally. She said the MoU would strengthen its relationship with NSEIX and help explore new growth opportunities, while advancing efforts to connect the two capital markets and create benefits for investors and companies.
The proposed collaboration will allow the exchanges to assess opportunities to expand cross-border market access and broaden investment avenues for issuers and investors in both jurisdictions. However, the MoU sets out areas for exploration rather than confirming the launch of specific products or trading arrangements.