Why GIFT City needs a dual-listed equity market

GIFT City was envisioned as a marketplace rather than a simple pass-through.

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On July 14, 2026, the International Financial Services Centres Authority (IFSCA) released a consultation paper proposing that companies list equity shares on GIFT City exchanges without a traditional public offer. It cites Spotify, Slack, and Coinbase as precedents and sets a minimum post-listing market capitalisation of $50 million. But the more consequential question it raises is why, after six years of institution-building, GIFT City still has no secondary equity market with assets that foreign investors choose to hold within it for its own sake.Examining the GIFT City markets ecosystem, the key figures are familiar but worth restating. As of March 2026, the assets of the International Banking Unit reached $111 billion, up from $88.51 billion in March 2025, a rise of about 25.4 per cent year-on-year. Fund Management Entities grew from 162 to 217 within this period, and registered funds or schemes totalled 360. Non-retail schemes raised a total of $39.09 billion in commitments, compared to $15.74 billion a year earlier — an increase of roughly 148 per cent. However, the data on capital deployment highlights the underlying structure: $15.36 billion of investments went into India and $1.59 billion abroad, totalling $16.95 billion. GIFT City efficiently channels capital, but unless it generates assets held by foreign investors, it remains a corridor rather than a true market..IFSCA’s efforts to build a listed equity market have met a lukewarm response, and the reason is structural. Currency and commodity derivatives at GIFT City faced a market already served by CME Group, ICE, and LME — venues with decades of incumbency that regulation cannot replicate. The equity secondary market faces the same problem: intermediaries at GIFT IFSC — custodians, depository participants, and broker-dealers — exist only as a framework and are very thin in practice. The regulation is present; the global-standard plumbing is not.The cold-start problemThe direct listing paper, as mentioned in the consultation paper, starts from the harder end. An unlisted company arriving at GIFT City has no price history, no index membership, and no existing shareholder base. Foreign institutional allocators deploy through screens that require trading history, analyst coverage, and liquidity benchmarks. A company meeting a $50 million capitalisation threshold at listing may not pass any of those filters on day one. Direct listing of unlisted issuers is a building block; it could not be a foundation for a secondary equity market.Dual listing enables companies already traded on NYSE, Nasdaq, or LSE to also list at GIFT City using a fungible share or depository receipt. The investor base is established, and prices are already determined in a robust primary market. Companies have already filed disclosures under IFRS or US GAAP. This approach doesn’t require capital to discover new information; instead, it allows existing holders of a known instrument to transact at GIFT City, leveraging a time-zone advantage.The evidence worldwide is clear. Alibaba’s secondary listing in Hong Kong in November 2019 raised $11.3 billion and achieved a first-day trading volume of $1.78 billion, accounting for over 10 per cent of HKEX’s total that day. By mid-2022, the average daily trading volume in Hong Kong was $0.7 billion, compared to $3.2 billion in the US. This represents about 22 per cent of global trading volume, offering Asian investors access to a familiar market for a stock they already owned. The London Stock Exchange’s International Secondary Listings category allows non-UK companies to access London markets without bearing full UK disclosure requirements — which is a model IFSCA could consider adopting.Collateral upsideA dual-listed equity market at GIFT City would benefit more than just the exchange. Custodians managing foreign-investor holdings require dollar-denominated infrastructure, daily MTM reporting, and standard margining. These enhancements would elevate GIFT City’s custody services from a licensed setup to a globally operational business. Depository participants would handle DVP (delivery versus payment) transactions, which are absent in a derivatives-dominated marketplace. Broker-dealers would establish research and market-making desks aligned with the Asia-Europe time zone. Meanwhile, legal and fintech firms specialising in multi-jurisdictional disclosure and order routing would find a strong commercial base in GIFT City, rather than in Singapore or Dubai. Ecosystem growth depends on ongoing, commercially viable activity driven by consistent demand for services.What IFSCA must now doIFSCA should develop a dual listing framework that runs in parallel, featuring an International Secondary Listings category. This category would require a qualifying primary listing on a recognised global exchange, along with IFRS/USGAAP financial statements. It should also include a fungible mechanism to prevent price divergence. A simple information document — rather than a full prospectus — should be acceptable if the primary exchange mandates continuous disclosure. Settlement must align with global prime-brokerage standards, including T+1 in dollar, DVP-based clearing, seamless Central Securities Depository (CSD) connectivity, and integration with global custodians. Finally, bilateral regulatory cooperation/understanding with home-market regulators must be established before any dual-listed company begins trading.GIFT City was envisioned as a marketplace rather than a simple pass-through. The recent listing announcement indicates IFSCA recognises what yet needs to be addressed. Enabling dual listings of internationally traded securities brings proven liquidity, enhances the ecosystem, and provides foreign investors with an equity asset class within GIFT City jurisdiction that is worth holding and trading in the Indian time zone.The intermediary community at GIFT IFSC must develop true global competence — not just be licensed but meet the high standards expected by sovereign wealth funds and pension managers. IFSCA should establish binding benchmarks for settlement timelines, reporting standards, and system integration. Ultimately, dual listing, globally capable intermediaries, and a regulatory regime will position GIFT City as the first choice for cross-border equity access in the Asian time zone.The writer is Partner, MCQubePublished on August 5, 2026