Listed Indian companies could be allowed to launch qualified institutional placement (QIP) of shares through exchanges at International Financial Service Centres (IFSCS) using an abridged prospectus.
“International exchanges at the IFSC can act as a driver to attract foreign capital into Indian companies through QIP issuances to select large institutional investors, particularly considering the benefits in terms of transactions in foreign currency, exemptions to eligible foreign investors from permanent account number (PAN), and income-tax return (ITR) filing requirements, etc,” the report stated.
“We are trying to democratise the set-up by offering more choices to Indian issuers. Unlisted companies will have a choice to come directly on the IFSC exchanges, and listed companies will have the alternative of doing a further issue — in the form of a QIP or a follow-on public offering on IFSC exchanges,” said V Balasubramaniam, managing director and chief executive officer, NSE International Exchange (IX), and a member of the working group.
The report recommends that the tax on dividends be reduced to 10 per cent for shareholders at IFSCs and that the exemption from obtaining PAN and return filing be extended to the eligible foreign investors even if they earn dividend income from the shares of Indian companies listed on IFSC exchanges, with certain conditions.
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