India Widens GIFT City Overseas Listing Rules: What It Means for Startups

The Ministry of Corporate Affairs has widened the rules for Indian companies that want to list directly on an international exchange in GIFT City. It notified the Companies (Listing of Equity Instruments in Permissible Jurisdictions) Amendment Rules, 2026 on 3 November 2026, in the Gazette of India as G.S.R. 968(E).

First, what this is not. It is not a grant, a subsidy or a scheme you apply to. It is a rule change for companies that are ready for a capital-markets listing, so for most early-stage founders it is background reading rather than something to act on this month. This post is our plain-English reading of press reports and the Gazette text. It is not a government communication.

What changed

Going by the Gazette text and a regulatory-update summary from TeamLease RegTech, the amendment changes the Companies (Listing of Equity Shares in Permissible Jurisdictions) Rules, 2024 in these ways:

• More than equity shares. The word "shares" is replaced with "instruments" throughout. "Equity instruments" is defined to mean equity shares, convertible debentures and preference shares issued by an Indian company.
• Unlisted public companies in IFSC. Unlisted public companies in the International Financial Services Centres jurisdiction are added, as long as they act in line with the International Financial Services Centres Authority Act, 2019 and the regulations under it.
• "Holders", not "shareholders". In rule 4, "existing shareholders" becomes "existing holders".
• Negative net worth is no longer a blocker by itself. A company with a negative net worth can issue equity instruments for listing if the issuer undertakes to allot at least 75 per cent of the net offer to qualified institutional buyers, under the rules of the securities market regulator in the listing jurisdiction.
• Revised conditions. TeamLease RegTech notes that conditions on existing holders, specified defaults and the period of relevant financial criteria have been revised. The sources we reviewed do not give the new wording, so we are not going to guess at it.
• A new form. Form LEAP-1, used to submit the prospectus with the Registrar, has been replaced with a new form. It asks, among other things, for the company's corporate identity number, name and registered office, and whether any inspection, investigation or inquiry has been ordered against it under the Companies Act, 2013.

The Gazette says the rules come into force on the date of their publication in the Official Gazette.

Where the listing happens

According to the PTI report carried by Rediff Money, the government permitted direct listing of securities by Indian companies on international exchanges at GIFT-IFSC in January 2024. India International Exchange and NSE International Exchange at the International Financial Services Centre in GIFT City, Gujarat, have been prescribed as permitted stock exchanges. Both are under the supervision of the International Financial Services Centres Authority (IFSCA).

So this amendment does not open a new exchange. It widens what can be listed there and who can list.

What the experts say

These are the views of the people quoted, not findings of the government.

• Anjali Malhotra, Nangia Global, says replacing "equity shares" with "equity instruments" widens the securities that can be listed, and that the change aligns the ministry's framework with the existing IFSCA Listing Regulations. On negative net worth, she says the 75 per cent allotment to qualified institutional buyers protects the investing public where those buyers are committed to invest.
• Suresh Swamy, Price Waterhouse & Co LLP, calls the amendments an important step that moves India's direct listing framework beyond a conventional equity-share regime. He says the switch from "shareholders" to "holders" looks minor but opens an exit route for the many Private Equity and Venture Capital investors who hold preference instruments rather than equity. He adds that the express recognition of unlisted public companies gives more regulatory clarity for GIFT IFSC.
• Amit Baid, BTG Advaya, says the changes could make GIFT City an attractive listing destination for high-growth startups and capital-intensive businesses that need substantial funding before they turn profitable. His caution: the regulatory door has been opened, but whether real capital flows follow depends on how quickly the FEMA and tax frameworks catch up, so that investors get the same certainty on exit and taxation as they do on entry. FEMA is the Foreign Exchange Management Act.

What has not been announced

The sources do not describe any funding support, fee, timeline or application process for a company that wants to use this route. They also do not name any company that has listed under the amended rules. Do not treat a listing here as something your startup can apply for through a portal today, because nothing of that kind has been announced.

What this means for you

• Early-stage or pre-revenue? This is not for you right now. Grants, incubators and seed funding are still where your attention belongs.
• Growth-stage and thinking about a listing? Take the rule text to your company secretary and lawyers. Whether your company qualifies, and on what conditions, depends on details the press coverage does not spell out.
• Investor-backed with preference shares? Swamy's point is the one to read closely. The move from "shareholders" to "holders" is described as opening an exit route for investors who hold preference instruments. Ask your investors and advisers how it applies to your cap table.
• Watch FEMA and tax. Baid's warning is the practical one. Until those frameworks catch up, exit and taxation certainty may lag behind the listing rules.
• Do not confuse this with a grant. Nothing here gives you money. It only changes where and how a company can raise it from the market.

We will update this page if official guidance on the conditions or the process is published.

Sources: PTI report carried by Rediff Money; Gazette of India Extraordinary G.S.R. 968(E) as reproduced by TaxGuru; TeamLease RegTech update on the Amendment Rules.

Cover photo: Zoshua Colah on Unsplash