Develop more GIFT City-like Financial Centers in major metro cities: Standing Committee on Finance

WhatsApp
Facebook
Twitter
Telegram
Copylink

Link copied successfully!

India’s first and only International Financial Services Centre (IFSC) was established within Gujarat International Financial Tec City (GIFT City).

About GIFT City IFSC (Gandhinagar, Gujarat)

It was established as a Special Economic Zone (SEZ) in 2015. Designated as a non-resident zone under Foreign Exchange Management Act (FEMA).
- IFSC is a jurisdiction that provides onshore and offshore financial services to non-residents and residents (institutions), in a foreign currency.
Functions:
- Favorable tax structure: Offer cross-border financial products and services within a competitive tax environment.
- Trusted regulatory environment: Provide onshore talent with an offshore technological and regulatory framework.
- Ease of doing business: Facilitates movement of international financial services based on global standards, promotes inbound and outbound investment to India.
Regulatory body: International Financial Services Centres Authority (IFSCA) regulates financial products, financial services and financial institutions in IFSCs in India.
- Established in 2020 under the IFSCA Act, 2019.
Current Status: GIFT-IFSC ranked 46th in the Global Financial Centres Index (a 5-rank improvement); ranked 45th in the FinTech rankings (a 4-rank improvement)

Committee’ Recommendations

Establish satellite financial innovation zones or fintech clusters: Region-specific models in major cities to foster inclusive growth, create talent pools and attract diverse investors.
- E.g. BRICS nations like China with 10 Centres, possess multiple financial hubs.
Streamlining of policies: Improving transparency, fostering financial education, enhancing digital infrastructure and regulatory sandboxes.
Other: Simplification of taxation regimes, reducing compliance burden, etc.