The government has allowed Indian companies to list directly on foreign exchanges. This was announced by Finance Minister Nirmala Sitharaman in her Budget speech for 2023-24. The move is expected to help Indian companies raise more capital from foreign investors and boost their visibility in global markets.
Previously, Indian companies could only list on foreign exchanges through American Depository Receipts (ADRs) or Global Depository Receipts (GDRs). This involved depositing shares with a foreign depository bank, which would then issue ADRs or GDRs to investors. The new rules allow Indian companies to list directly on foreign exchanges, without having to deposit their shares with a foreign depository bank.
The government has also said that it will simplify the process for Indian companies to list on foreign exchanges. This includes reducing the number of documents that companies need to file, and streamlining the approval process.
The move is expected to benefit a number of Indian companies, including technology startups, unicorns, and large companies. It is also expected to attract more foreign investment into India.
Here are some of the benefits of direct listing by Indian companies on foreign exchanges:
- Increased access to capital: Indian companies will be able to raise more capital from foreign investors, which will help them to grow their businesses.
- Increased visibility: Listing on foreign exchanges will give Indian companies greater visibility in global markets, which will help them to attract new customers and partners.
- Improved corporate governance: Indian companies will be subject to the same corporate governance standards as foreign companies, which will help to improve their reputation and attract investors.
Overall, the move to allow direct listing by Indian companies on foreign exchanges is a positive development for the Indian economy. It is expected to help Indian companies to raise more capital, improve their visibility, and attract new investors.
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