UTI Asset Management is launching the UTI India Nifty 50 Index ETF VCC, scheduled to list in Singapore on 12 November. According to reports from Stock Market News, this will be Singapore's first Nifty 50 ETF and the first MAS-authorized retail feeder fund investing directly into an India-domiciled fund. The ETF will trade on the SGX in US and Singapore dollars and will invest 95% to 100% of assets in the India-listed UTI Nifty 50 ETF, charging up to 0.43% a year as fees.
The feeder structure allows the ETF to claim an exemption under the India-Singapore tax treaty, avoiding capital gains taxes of 12.5% on long-term holdings and 20% on short-term investments. As reported by Stock Market News, this represents a significant tax advantage for foreign investors seeking exposure to Indian equities. The initial offer runs through November 6 at $1 a share, with Phillip Securities Pte., Flow Traders Asia Pte. and North Point Global Pte. serving as market makers.
The launch comes as higher investment taxes, relatively rich valuations and limited exposure to the AI boom have weighed on India's appeal, leaving its stock benchmark on course for its first annual decline in 11 years. According to Stock Market News, any reduction in the tax drag may improve India's competitiveness against other emerging markets as concerns over funding and borrowing costs test the global AI trade. Jermyn Wong, chief executive officer of UTI International Singapore, stated that "the time is ripe to launch an ETF providing investors a solution to access India that is low-cost and transparent," noting that large cap valuations in India are currently looking attractive.
While GIFT City, India's international financial services hub, already offers fund structures with tax advantages, those aren't necessarily comparable to a publicly traded ETF. As reported by Stock Market News, the prospectus flags a potential tax risk: while the fund expects to claim a treaty exemption on gains from the sale of Indian mutual-fund units, Indian authorities could challenge that position. The product may provide an early test of whether tax-efficient structures can help India compete for global capital without a broader change to its tax regime.
