Against the backdrop of Thursdays's official (virtual) meeting between Luxembourg's Prime Minister Xavier Bettel and India's Prime Minister Narendra Modi, the Luxembourg Stock Exchange (LuxSE) announced the signing of two Memoranda of Understanding (MoU) with Indian counterparts.
The cooperation agreements with the State Bank of India (SBI) and the India International Exchange (IFSC) Limited (India INX) respectively were facilitated by Luxembourg's Ambassador to India, Jean Claude Kugener. These agreements aim to promote ESG (environmental, social and corporate governance) and Green Finance in the Indian market, among other channels of cooperation.
Robert Scharfe, CEO of LuxSE, commented: “As a leading global exchange, it is our aim to unite the world’s issuers and investors and facilitate sustainable investment across the world. Through these two milestone agreements with SBI and INX, we enter the Indian market to bring international investors closer to Indian issuers and build strong and mutually beneficial relationships with Indian market participants, particularly in the green sphere".
A first virtual event, which took place on Wednesday 11 November 2020, between LuxSE and SBI marked the first agreement that the former signed with an Indian institution. It was also the first MoU signed by SBI, making the celebration a milestone occasion for both institutions.
Dinesh Khara, Chairman of SBI, noted: “The MoU with Luxembourg Stock Exchange will open up new avenues for market development and fund raising in green bond market. SBI has played a crucial role in the development of India’s capital market, most notably through the launch of SBI Capital Markets in 1986, which is now India's leading investment bank and project advisor that assists domestic companies in mobilising crucial funds".
One week later, on Tuesday 17 November 2020, LuxSE hosted a virtual ceremony with India INX, where representatives from both international exchanges spoke of the need for a renewed sense of unity in order to reorient capital flows towards sustainable development.
India INX Managing Director and CEO Shri. V. Balasubramanian commented: “This pact is very special to us as we believe we can provide issuers and investors with an opportunity to list and trade green bonds on our platform GSM Green with the opportunity to dual list with the Luxembourg Stock Exchange, which is the largest green bond listing platform with exceptional governance standards. We envisage this pact will strengthen ties between the two countries and encourage more green funding, which is in line with the government of India’s initiative of sustainable development”.
INX is a subsidiary of the Bombay Stock Exchange and is India’s first international exchange, founded in January 2017. Although young in terms of the global financial industry, Indian INX has marked many important milestones since its inauguration including the creation of its Global Securities Market, which is the country’s first international primary market platform connecting global investors with Indian and foreign issuers.
Through these international agreements, LuxSE will work closely with both SBI and INX to unite issuers and investors across borders around the global goals defined in the United Nations Sustainable Development Goals (SDGs) and the Paris Agreement.