Bombay Stock Exchange (BSE) has introduced Sensex derivative contracts at the International Financial Services Centre (IFSC) in GIFT City, Gujarat. This new offering enables foreign investors to trade India’s benchmark Sensex index without worrying about currency conversion risks, as the contracts are denominated in US dollars.
These contracts will be available on India INX, BSE’s dedicated exchange for GIFT-IFSC. The minimum investment required is set at $1, and settlements will be conducted in cash, in US dollars. Each contract will follow a three-month trading cycle, with the final settlement taking place on the last Tuesday of the contract month.
With a 22-hour trading window, these derivatives provide international investors with greater flexibility to engage with Indian markets across different time zones. Additionally, GIFT City offers several tax incentives, including exemptions from securities transaction tax, capital gains tax, and stamp duty, making it an attractive destination for global traders.
BSE Managing Director and CEO Sundararaman Ramamurthy highlighted that GIFT City’s competitive environment would benefit international investors.
India INX, BSE’s international exchange, recorded an average daily turnover of $206 million in FY24-25. Meanwhile, the National Stock Exchange (NSE) has been offering Nifty-based derivative contracts at GIFT City through its partnership with the Singapore Exchange. In July 2023, SGX Nifty was migrated to NSE’s International Exchange and rebranded as GIFT Nifty, which saw significant growth, with an average daily turnover reaching $95 billion in January.
The launch of Sensex derivatives aims to enhance global participation in Indian markets while offering tax efficiency and extended trading hours.
