Singapore Exchange (SGX), a favourite destination for Indian companies and investors, opened a liaison office in Mumbai. It is the first foreign exchange to have an office in India. SGX's chief M Muthukrishnan Ramaswami spoke to Arup Roychoudhury about Indian markets, future plans for the country, and expectations from the government. Excerpts
What has been the biggest impact of the Narendra Modi government so far among the global investors seeking to invest in India?
The biggest impact, I think, is that there is going to be policy certainty. That is the single largest help. You can take each policy and argue whether that is the best policy or not, but that is not the point as much as there is certainty around policy. As long as you have certainty, people will know how to operate within that policy and then, therefore, make their investments or choices.
In his Budget speech, the finance minister allowed international clearing of Indian bonds. Does that infuse more liquidity into the Indian and Asian bond markets? How will SGX benefit from this, given that some $60 billion in bonds have been listed on it by Indian companies?
The initial focus will be on clearing infrastructure like Euroclear, where they will keep these bonds so that the mechanism for settling them becomes international. Those are the things one does post-trade, and these are not going to help us trade the bonds. In Asia, bond market liquidity is generally lower compared with Europe or North America, and that is generally not going to change anytime soon, but the ability to raise financing is going to improve.
You have said that the expected infrastructure investment in India is something you are looking forward to. How much of that is SGX hoping to capture?
For us, bigger the share of that, better it is.
What are you future plans in India? Are you looking to increase stake in BSE?
We work with BSE and NSE closely. We will look at what we can do to service their needs against ownership or anything like that. I don't think regulations are changing. We constantly launch products that are Asean or South Asia or China focused, so in that context we have a pipeline of products, but not anything immediate or specific.