GIFT City – India’s up-and-coming economic and financial center

India is one of the fastest growing economies in the world. The country needs to expand its economic and strategic activities globally, and GIFT City, an emerging global financial center and India’s first viable smart city, is playing a critical role in realizing this vision.

Prime Minister Narendra Modi conceived the idea of ​​GIFT City in 2007 as Chief Minister of Gujarat. His vision was to create a globally recognized financial center that could compete with the renowned financial centers in London, Tokyo, Shanghai, Paris, Singapore and Dubai. Since its conception, GIFT City has made rapid progress. The support GIFT City has received from the central and Gujarat governments has acted as a catalyst to accelerate its growth.

Spread across 886 acres in Gandhinagar, GIFT City consists of a multi-service Special Economic Zone (SEZ) which is home to India’s first International Financial Services Center (IFSC) and an Exclusive Domestic Tariff Area (DTA). Approximately 261 acres have been demarcated as SEZ while 625 acres have been designated as DTA. The plan is to develop 62 million m² of built-up area, consisting of commercial space (67 percent), residential space (22 percent) and social space of 11 percent.

The social infrastructure in the city includes a school, medical facilities, a planned hospital, a GIFT City Business Club with indoor and outdoor sports facilities. It also includes integrated, well-planned housing projects that make GIFT City a true walk-to-work city. GIFT is a smart city in every sense, with various first-in-the-country initiatives in the field of urban infrastructure.

India’s first International Financial Services Center (IFSC) became operational in GIFT City. An IFSC makes it possible to bring back to India the financial services and transactions currently conducted in offshore financial centers by Indian corporations and overseas branches/subsidiaries of Financial Institutions (FIs) by providing a business and regulatory environment that is comparable to other leading ones international companies is comparable to financial centers like London and Singapore. It would give Indian companies easier access to global financial markets. IFSC would also complement and encourage further development of financial markets in India.

GIFT IFSC offers services related to capital markets, offshore insurance, offshore banking and asset management, aircraft and ship leasing and ancillary services. It hosts two international exchanges with a combined average daily trading volume of over $11 billion. An international precious metals exchange is also to be set up in the near future.

As the dynamic nature of business in the IFSCs requires a high level of inter-regulatory coordination within the financial sector, the IFSCA was established as a single regulator with a holistic vision to facilitate business operations in the IFSCs and create a world-class regulatory environment. The main objective of IFSCA is to build a strong global connection and focus on the needs of Indian economy as well as to serve as an international financial platform.

The business-friendly regulatory system and conducive ecosystem have made GIFT City an ideal place for investment, and over 300 units are already operational in GIFT SEZ and DTA.

The recent announcement by the Government of India to allow foreign university campuses in GIFT IFSC free from domestic regulations has caused a worldwide stir. Many Australian, UK and US based universities have expressed interest in establishing their presence at GIFT IFSC.

Despite the global challenges posed by the Covid-19 pandemic, GIFT City continued to attract national and international players.

Prime Minister Narendra Modi’s vision for GIFT City is already taking shape. In the years to come, GIFT City will be a fixture in FinTech, data security and finance that will make not only Gujarat but the whole country proud.

The author is chairman of GIFT City

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