Gujarat International Finance

August 20, 2024

Tec-City (GIFT City) in Gandhinagar is rapidly transforming into a premier global financial and IT hub. With its strategic initiatives and infrastructural developments, GIFT City is poised for significant growth, offering a glimpse into the future of urban and economic development in India. Here’s an in-depth look at the promising future of GIFT City.

Infrastructure and Connectivity Enhancements

New Provisions for Additional Parking To address the rising vehicular traffic, GIFT City has swiftly responded by creating temporary parking arrangements. This rapid response ensures that the city’s infrastructure keeps pace with its growth, maintaining convenience and efficiency for residents and visitors.

Enhanced Public Transport Public transport is set to improve significantly with over 20 buses now operating between GIFT City and Ahmedabad/Gandhinagar. This enhanced connectivity will facilitate easier commuting, reduce traffic congestion, and promote eco-friendly transportation options.

GIFT IFSC: Emerging Business Hub

GIFT International Financial Services Centre (IFSC) is becoming a key destination for various high-growth business areas, including ship and aircraft leasing, finance companies, and Global In-house Centers (GICs). Several recent regulatory updates support this diversification:

IFSC Banking Units: Indian banks’ IFSC banking units can now act as Trading Members of the India International Bullion Exchange IFSC Ltd (IIBX), enhancing their trading capabilities.
Investment Contributions: NRIs, OCIs, and RIs can now invest up to 100% in Foreign Portfolio Investments (FPI) based out of IFSC.
Cross Border Reinsurers (CBRs): CBRs are mandated to maintain collateral for Indian Reinsurers’ business within India/GIFT IFSC.
Overseas Portfolio Investment (OPI): Unlisted Indian companies can invest in IFSC and overseas jurisdictions through OPI.
Liberalized Remittance Scheme (LRS): Indian residents can use LRS to open foreign currency accounts in GIFT City, enabling diverse investments and expenditures.

New Business Opportunities in GIFT IFSC

GIFT IFSC is expanding its range of financial services. Recent notifications include:

Bookkeeping, Accounting, Taxation, and Financial Crime Compliance These services are now recognized as financial services, attracting a broader spectrum of businesses.
Payment Services Regulations: The IFSCA has notified new regulations to govern payment services, further enhancing the financial landscape.

Financial Landscape

GIFT City is home to a robust financial ecosystem, including:

28 banks
2 international stock exchanges
India International bullion exchange and bullion vaults
35 insurance and reinsurance offices/intermediaries
2 foreign universities
1270+ capital markets intermediaries
30 aircraft leasing firms
55 fintech entities
124 fund management entities
12 ship leasing firms

Key Upcoming Developments

Several developments are underway to enhance public utilities and the quality of life, including a health center, accessible toilets, and food trucks, all expected to be operational by the end of the year.

Vibrant Life at GIFT City

GIFT City is not just about business; it also offers a vibrant cultural and recreational life with events such as the GIFT City Run, concerts featuring artists like Vishal Mehra and B-praak, international artist concerts, the World Junior Chess Championship, Filmfare awards, and traditional Garba events.

Significant Announcements

RBI Governor Visit: The RBI Governor is set to visit GIFT City, highlighting its importance.
IBM MoU: IBM has signed an MoU to establish an AI cluster in GIFT City.
Deakin University: Deakin University will welcome its first postgraduate batch, enhancing educational opportunities.
RBI Forex Accounts: RBI has allowed forex accounts in GIFT City, widening the scope of LRS.
Metro Connectivity: The Ahmedabad-Gandhinagar metro route is likely to be operational by August, further improving connectivity.
BNP Paribas and SMBC: French banking major BNP Paribas and Japan’s Sumitomo Mitsui Banking Corporation are set to launch operations in GIFT City, adding to its global financial network.

Welcoming New Entities

GIFT IFSC continues to attract prominent entities across various sectors, including:

Alternative Investment Funds: Asia Pragati, ADIA, Capital Mind, LICHFL Asset Management Company Limited, Next Bharat
IFSC Banking Units: BNP Paribas, ANZ, SMBC, Mizuho
Finance Companies: ONGC Videsh, IREDA, REC, PFC
Ship & Aircraft Leasing: Reliance Industries Limited, Adani, Samvardhana Motherson

Conclusion

GIFT City Gandhinagar stands at the cusp of a transformative future, driven by strategic developments, regulatory support, and a vibrant ecosystem. As it continues to grow and diversify, GIFT City is set to become a beacon of innovation, efficiency, and global financial integration, marking its place as a premier destination for businesses and residents alike.