IFSCA Proposes Secondary Listing Route for Global ETFs in GIFT IFSC; Comments Due September 17
The International Financial Services Centres Authority (IFSCA) has proposed a route for exchange-traded funds already listed in India or abroad to obtain a secondary listing on a recognised stock exchange in GIFT IFSC without the ETF's manager having to set up a Fund Management Entity (FME) in the IFSC only for that purpose. The IFSCA Consultation Paper on Secondary Listing of Exchange Traded Funds in IFSC, dated 27 August 2026, invited public comments up to 17 September 2026.
A secondary-listed ETF keeps its primary listing, manager, portfolio and ISIN in its home jurisdiction. The IFSC listing only adds another trading venue for the same fund.
Why IFSCA is revisiting Chapter VII
Regulation 114 in Chapter VII of the IFSCA (Fund Management) Regulations, 2025 already lets an ETF listed in India outside the IFSC, or in a foreign jurisdiction, list and trade on an IFSC exchange. The paper points out that this proceeds on the basis that the fund is brought to the IFSC by an FME registered with the Authority. Global managers have shown interest in listing overseas ETFs in the IFSC without registering here, and IFSCA considers a full FME set-up disproportionate where the fund continues to be managed and primarily regulated at home.
The paper cites the growth of the IFSC fund industry: 235 FMEs and 416 schemes as of 31 July 2026, and investors in Retail Schemes rising from 255 on 30 September 2025 to 3,438 on 31 March 2026, more than thirteen-fold. Globally, ETF assets stood at about USD 23.11 trillion in July 2026. The number of ETFs rose from 14,640 in July 2025 to 17,654 in July 2026, and those ETFs had 34,072 listings on 85 exchanges in 66 countries.
The proposed conditions
| Proposed provision | What it requires |
|---|---|
| Regulation 114A: eligible manager | A Registered FME (Retail) in the IFSC, or a manager regulated in India or abroad for retail fund management that meets the fit-and-proper criteria under Regulation 9(1) |
| Regulation 114B: eligible ETF | Primary objective of replicating an index; home regulation that protects investors and guards against misuse of unpublished price sensitive information and market manipulation; at least 12 months of listing and trading |
| Regulation 114C: local representative | Mandatory where the manager is not an IFSCA-registered FME |
| Regulation 114D: disclosures | Specified disclosures in English, filed with the IFSC exchange concurrently with filings on the home exchange |
The 12-month seasoning can be relaxed for ETFs launched by a Registered FME (Retail) or for a manager with a sound track record, which the paper defines as at least five years of managing assets of at least USD 200 million, more than 25,000 investors and at least five listed ETFs at the time of application.
The local representative may be an associate of the manager regulated by IFSCA as an FME, capital market intermediary or banking unit, a Registered FME (Retail), or a Registered FME (Non-Retail) permitted to manage third-party funds. It would act as the liaison between investors and the manager, including for grievance redressal, accept notices from the Authority, furnish records on request and inform the exchange of trading suspensions or material developments in the home jurisdiction.
Under proposed Regulation 114D, the disclosures would include the ETF's home jurisdiction and primary regulator, a statement that the ETF is secondary-listed and not constituted in the IFSC, manager and representative details and their roles, trading, market making, clearing and settlement arrangements, fees and charges, tax treatment for IFSC investors, additional risk factors and the grievance mechanism. Managers must give IFSC investors at least the same protection that home-jurisdiction investors receive.
Role of the IFSC exchange
The recognised stock exchange would verify the eligibility of the ETF and its manager, intimate IFSCA before admitting the ETF, and frame rules on listing and trading conduct. These include market-maker norms covering eligibility, minimum number of market makers, maximum spreads, minimum quote quantities, hours of availability, incentives and settlement. Consequential changes are proposed to Regulation 115 (suspension, including for breach of exchange conditions), Regulation 116 (delisting) and Regulation 117, which would let managers of secondary-listed ETFs seek voluntary delisting.
International models and expected impact
IFSCA compared the regimes of Hong Kong, Singapore and Mexico. None requires the overseas manager to establish itself in the host market, but all rely on quality home regulation, a local representative, a product track record and timely disclosure with continuous quotes. IFSCA expects the route to give IFSC investors access to established global ETFs, to add participants and volumes on IFSC exchanges, whose product mix it describes as predominantly derivative and debt-oriented, and over time to support ETFs domiciled in the IFSC.
Status
Comments were to be sent by 17 September 2026 in MS Word or MS Excel format by email to FME-Regulations@ifsca.gov.in and the officials named in the paper, with the commenter's details, the regulation number, the suggestion and its rationale. The proposal is a consultation draft; the amended regulations will apply only once IFSCA notifies them. The paper is available on the IFSCA public consultation page.
Updated on 28 September 2026: linked the IFSCA consultation paper and added the proposed Regulations 114A to 114D, the track-record relaxation, the local representative's duties, the disclosure list, exchange market-making rules and the comment submission details.
