Global index providers FTSE Russell and S&P Dow Jones Indices on March 18 started including the Saudi Arabian stock exchange in their respective emerging markets indexes.

The Saudi Stock Exchange, also called Tadawul, will be added to the FTSE Russell Emerging Markets index in five tranches over the next 12 months, with the initial 25% inclusion split over March and April. The remaining 75% will be implemented with quarterly reviews in June, September and March 2020, according to a news release by the stock exchange.

Meanwhile, Tadawul is eligible for 50% of float-adjusted market capitalization on S&P Dow Jones Emerging Market Indices' Global Benchmark Indices starting March 18, with the remaining 50% inclusion expected Sept. 23.

Tadawul's inclusion comes on the back of Saudi capital market reforms over the past two years in a bid to attract domestic and foreign investment and align the country's regulatory framework with international standards. Saudi authorities are trying to attract more international capital under their Saudi Vision 2030 plan to reduce dependence on oil and diversify the economy.

S&P Dow Jones Indices and S&P Global Market Intelligence are owned by S&P Global Inc.