GIFT Nifty yet to strike it big, nearly 2 years since switch

India's ambitious push to bring home trading in Nifty 50 derivatives has made limited progress in nearly two years, as many traders tempted by cost and logistical advantages keep faith in the Singapore Exchange (SGX).

- Srushti Vaidya

While the share of GIFT Nifty volumes originating from within GIFT City has nearly doubled to 33% during the period, it is still a long way from realizing the goal of attracting the majority of these trades to India.

In 2023, India's NSE and Singapore's SGX agreed to transition the SGX Nifty—popular among foreign traders keen to take exposure to the Indian markets—to the NSE International Exchange (NSE IX) in Gujarat International Finance Tec-City (GIFT City).

However, brokers and traders said that the majority of trades in SGX Nifty, now rebranded GIFT Nifty, still originates from the Singapore exchange.

The culprit: higher transaction costs and harder onboarding in India, and logistical advantages offered by Singapore's established financial infrastructure.