Singapore Stock Exchange (SGX) will stop offering trades of single stock futures linked to Indian equities from October.What triggered this is not immediately clear but three senior industry persons told ET that the decision may have followed Indian authorities questioning the use of stock prices from exchanges here for derivative contracts traded on SGX.In recent years this would be the second outcome of negotiations between India and Singapore in changing arrangements related to listed derivative trades with Indian equities as underlier.ET BureauTill 2023, SGX Nifty - a futures contract linked to India's Nifty 50 index - was traded on SGX, letting international investors take exposure to Indian stock movements without directly trading on Indian exchanges. Amid a surge in SGX Nifty trade volumes and India's efforts to bring back the offshore trades that were being lost to Singapore, SGX Nifty was discontinued and replaced by GIFT Nifty. This was achieved through a revenue-sharing framework agreed between SGX and NSE International Exchange in Gift City.However, the end of single stock futures (tracking Indian stocks) on SGX may take a different course. According to Rajesh Gandhi, partner Deloitte India, "Foreign investors who take exposure to Indian stock futures via SGX may have to realign how they invest depending on the framework which is ultimately agreed. For instance, if a 'stock connect' is not allowed, foreign investors will have to either get a foreign portfolio investor (FPI) license and invest on NSE/ BSE or trade on the GIFT exchange under the Eligible Foreign Investor (EFI) route. Gains from trading on GIFT exchange will be tax exempt though one will have to see how volumes grow there."If the single stock future volumes shifts from SGX to Gift City, then the contracts will be traded like GIFT Nifty which is denominated and settled in US dollars."What we understand is that the Securities & Exchange Board of India (Sebi) had expressed its reservations about the trade of these Indian equity-linked single stock futures on SGX. The matter was being discussed for the last few months. Probably, Singapore may have also reviewed the legal position on the use of a local exchange platform for derivatives linked to foreign stocks before giving up its right," said the CEO of a large domestic fund.Sebi and SGX did not respond to ET's queries.Unlike the SGX Nifty, the volumes on 49 single stock futures connected to Indian equities did not increase the way SGX Nifty volumes had grown. This was primarily because SGX Nifty captured the mood in international markets before trading began in India. "So, it's too early to say how much funds and volume India would eventually attract if there's a migration of single stock futures volumes from Singapore."It may be mentioned that while Indian residents can invest in listed stocks in GIFT City, they are not permitted to trade in GIFT Nifty and derivatives under the Reserve bank of India's liberalised remittance scheme (LRS). GIFT City is treated as an offshore jurisdiction under LRS and foreign exchange regulations.