The GIFT International Financial Services Centre ("GIFT IFSC") established in Gandhinagar, Gujarat is India's first international financial services centre with the intent of catering to global MNCs and financial institutions in alignment with international standards of business. To ensure that utmost benefits can be provided, the entire zone has been equipped with world class infrastructure akin to global standards. This newsletter navigates the journey of GIFT IFSC and the International Financial Services Centres Authority ("IFSCA") set up under the International Financial Services Centres Authority Act, 2019.
IFSCA as a unified regulator is also head quartered at GIFT IFSC and is committed to providing a sound and well-structured regulatory environment by providing a single window clearance system. The IFSCA has been able to achieve this through unification of the powers previously held by four separate regulators: Reserve Bank of India ("RBI"), Securities and Exchange Board of India ("SEBI"), Insurance Regulatory and Development Authority of India ("IRDAI"), and Pension Fund Regulatory and Development Authority of India ("PFRDAI").
We regularly provide updates on legal and regulatory developments related to GIFT IFSC.
PPFAS to launch GIFT City subsidiary
October 28, 2024 - PPFAS Asset Management is gearing up to establish a subsidiary in GIFT City, with plans to launch operations within the next six months. This strategic expansion aims to simplify investment pathways for international investors who prefer to avoid Foreign Portfolio Investment (FPI) registration, and for NRIs looking to bypass the Portfolio Investment Scheme (PIS) requirements in India. Through its GIFT City subsidiary, PPFAS will offer dollar-denominated Net Asset Value (NAV), enabling seamless investments in GIFT City-based funds. This move allows global investors streamlined access to Indian equity exposure without the need for FPI or PAN registration, enhancing convenience and flexibility in a rapidly growing market.
Source: The Hindu Businessline
Computer Age Management Services sets up second office at GIFT City
October 23, 2024 - Computer Age Management Services (CAMS) has announced the opening of its second office in GIFT City, marking a significant expansion in its operations. As one of the pioneering Registrar & Transfer Agents (RTAs) in the city, CAMS provides robust fund administration services tailored for financial institutions launching funds both globally and in GIFT City. This larger, strategically positioned office supports the evolving growth and global ambitions of CAMS's clients. The expansion offers clients unparalleled advantages, including a business-friendly environment with strong regulatory support, streamlined administrative processes, and seamless global connectivity, empowering them to scale efficiently in a dynamic financial ecosystem.
Source: Business Standard
IFSCA issues circular providing clarity on the Format and manner of seeking authorisation to commence or carry on a Payment System in IFSC
October 23, 2024 – In accordance with sub-regulation 2 of Regulation 4 of the IFSCA (Payment and Settlement Systems) Regulations, 2024, IFSCA has established the format and process for applying to operate a Payment System within an IFSC. Any entity wishing to initiate or manage a Payment System must submit an application in the prescribed format, along with required supplementary information, to the Authority. Additionally, IFSCA reserves the right to request further information from the applicant as needed.
Source: GIFT IFSCA website [ Circular dated 23rd October, 2024]
Land Development and Pricing Policy announced for GIFT City
October 21, 2024 – GIFT City has introduced a new Land Development and Pricing Policy, establishing a framework for development rights on a per-square-foot basis. Under this policy, land will be leased for a period of 99 years, with an annual lease fee of Rs 10 per square meter. Effective from September 15, 2024, the policy governs the allocation of new development rights across three categories: Commercial DTA (Domestic Tariff Area), Commercial SEZ, and Residential.
The policy also includes specific pricing and development rights provisions for institutions intending to use land for captive purposes. Clear development timelines are outlined, requiring that for land parcels up to 7.50 lakh square feet, construction must begin within one year of allotment and be completed within four years. For parcels over 7.50 lakh square meters, construction should conclude within five years. To encourage adherence, the policy incorporates penalties through penal charges for delays, alongside incentives for early project completion.
Source: GIFT Gujarat website
GIFT City and IFSC organizes Talent Summit
October 21, 2024 – The "GIFT City: The Emerging Talent Frontier" Talent Summit, hosted by GIFT City and the International Financial Services Centre (IFSC) at IIT Gandhinagar, brought together a powerhouse lineup of industry leaders, government representatives, and academic experts. This collaborative forum addressed the region's burgeoning talent requirements and workforce development strategies essential to supporting the rapid growth of businesses within GIFT City and Gujarat.
The summit attracted high-profile executives from BNY, Capgemini, IBM, Wayfair, KPMG, Maersk, and PwC, who offered strategic insights into aligning workforce strategies with the dynamic shifts in technology and global market demands.
Two compelling panel discussions were held. The first, "Developing a Talent Pool for the World," delved into the evolving talent landscape as Global Capability Centres (GCCs) progress up the value chain. Panelists highlighted the importance of diversifying the workforce by increasing women's representation in tech roles, aligning with Gen Z's ambitions, and building strategic partnerships with startups to drive innovation and expand access to top talent.
The second panel, "Building a Long-Term Talent Supply Chain," spotlighted successful industry-academia partnerships and the continuous evolution of curricula to match industry needs. Discussions covered best practices for scaling operations in GIFT City and the challenges posed by salary inflation. The speakers underscored the importance of sustainable compensation strategies to enhance talent acquisition and operational efficiency, setting the stage for a resilient talent ecosystem in Gujarat.
Source: India Education Diary
Deakin University commits $1 million AUD at its GIFT City Campus
October 18, 2024 - Australia's Deakin University, recognized as the first foreign institution to establish an independent campus in Gujarat's GIFT City, has committed an investment of $1 million AUD towards 'Impact Projects' aimed at enhancing higher education, sports, and disaster management in India. This announcement was made during the international conclave titled 'Building an Innovative Ecosystem – GIFT City,' which the University organized to commemorate its 30 years of involvement in India. The "Impact Projects" will focus on strengthening disaster resilience in India through collaborations with the National Institute of Disaster Management (NIDM) and Humanitarian Aid International (HAI). These partnerships aim to enhance India's disaster management framework. Additionally, a collaboration with the National Institute of Educational Planning and Administration (NIEPA) and the Gujarat Education Department was announced to support teacher training initiatives. An MoU on Sports Impact Projects was also unveiled, focusing on four key areas: digitalization of the sports industry, increasing participation, improving performance and leadership opportunities for women, developing India's sports science workforce, and shaping the future of sports administration.
Source: Indian Express
IFSCA issues circular on listing of Commercial Paper and Certificate of Deposit on stock exchanges in IFSC
October 17, 2024 – The IFSCA has issued a circular in accordance with the IFSCA (Listing) Regulations, 2024 ("Listing Regulations"), outlining the criteria for listing Commercial Paper and Certificates of Deposit on recognized stock exchanges within the IFSC. This circular specifies the eligibility requirements for issuers and investors, including that issuers must be incorporated or established in an IFSC, in India, or in a foreign jurisdiction. Additionally, the securities to be listed must be freely transferable and held in dematerialized form, among other conditions.The circular also details the required disclosures for listing applications, such as general information about the issuer, risk factors, management details, and any defaults. It further outlines the compliance procedures to be followed in the event of a buyback.
Source: GIFT IFSCA website [ Circular dated 17th October, 2024]
InCorp Global becomes the first firm at GIFT to receive book-keeping, accounting licence
October 16, 2024 - InCorp Global, a provider of corporate solutions and professional services across the Asia-Pacific, has become the first firm at GIFT IFSC to receive a BATF (Bookkeeping, Accounting, Taxation, and Financial Crime Compliance) licence under the IFSCA (BATF Services) Regulations, 2024. This licence authorises InCorp Global to offer BATF services to businesses beyond the BFSI sector.
Manish Modi the CEO of InCorp Global in India stated "Securing the BATF licence is a pivotal moment for InCorp Global in India, affirming our leadership in shaping the financial services framework at GIFT IFSC. This licence empowers us to deploy India's depth in talent and capabilities to offer tailored services to global clients, further strengthening our presence in the global market. We aim to facilitate a seamless entry for global clients into the Indian market, while actively contributing to GIFT City's growth as a global financial hub."
Source: The Hindu Businessline
PFC Infra Finance IFSC Ltd gets approval to operate in GIFT City
October 16, 2024 – PFC Infra Finance IFSC Ltd (PIFIL), a subsidiary of Power Finance Corporation, has received approval from the International Financial Services Centres Authority to commence operations as a finance company in GIFT City. PIFIL is focused on providing loans in foreign currencies to both government and private entities in India and abroad. The establishment of PIFIL will enhance PFC's global brand presence and play a pivotal role in strengthening India's position as a global financial hub. Notably, PIFIL will be the first finance company in the IFSC dedicated to lending in the power and infrastructure sectors.
Source: Business Standard
Anicut Capital secures $11 million via the GIFT City structure
October 14, 2024 – Anicut Capital, a diversified investment firm managing various Alternative Investment Funds (AIFs) across both debt and equity strategies, has secured $11 million in dollar-denominated investments through the GIFT framework for its Private Credit Fund 3. This capital will support the firm's efforts to reach its overall target corpus of ₹1,500 crore, which it is currently raising for the fund. Since its inception, Anicut has deployed ₹3,200 crore across mid-sized enterprises.
Source: The Hindu Businessline
IFSCA issues directions for operations of the Foreign Currency Accounts (FCA) of Indian resident individuals (RI)
October 10, 2024 – The IFSCA has issued a circular to International Banking Units (IBUs) regarding the opening of Foreign Currency Accounts (FCAs) for Resident Individuals (RIs) as permitted by the RBI Circular "Remittances to International Financial Services Centres (IFSCs) under the Liberalised Remittance Scheme (LRS)." The circular outlines the guidelines for opening FCAs to receive remittances under LRS from both onshore India and locations outside of India. It also provides instructions for accessing financial services and products in IFSCs and other foreign jurisdictions, along with the reporting requirements that IBUs must follow.
Source: GIFT IFSCA website [ Circular dated 10th October, 2024]
Rolls-Royce concludes its first deal from GIFT City
October 09, 2024 – Rolls-Royce has completed its first engine leasing transaction at GIFT City, leasing two CFM Leap-1B engines to Akasa Air for its Boeing 737 Max aircraft. The transaction, conducted through a sale and leaseback arrangement, marks the inaugural deal for Rolls-Royce's leasing arm. This milestone represents the first step in expanding the entity's presence in the region.
Source: The Hindu Businessline
HDFC establishes subsidiary in GIFT City
October 08, 2024 – HDFC Bank has announced the incorporation of HDFC Securities IFSC Limited, a wholly owned subsidiary of HDFC Securities Limited. The new entity aims to provide broking and clearing services within the International Financial Services Centre at GIFT City, offering a range of financial products to residents, NRIs, and FPIs listed in the special economic zone. This initiative marks a significant step in HDFC Bank's efforts to expand its financial services footprint.
Source: Yahoo Finance
ADIA commences operations in GIFT City
October 07, 2024 – The Abu Dhabi Investment Authority (ADIA), the largest sovereign wealth fund in the United Arab Emirates and one of the largest globally, has officially commenced operations in India following the acquisition of the necessary regulatory approvals and the establishment of its office in GIFT City, Gujarat. This office is expected to enhance ADIA's investment activities in India.
The Indian Ministry of Commerce stated, "ADIA's presence in GIFT City underscores the strong interest of UAE institutional investors in India's growing and dynamic economy. It also reinforces GIFT City's reputation as a world-class financial services center operating under a robust regulatory and legal framework."
Source: The Print
IFSCA issues guidelines for utilisation of office space or manpower or both by Finance
Company(ies)/ Unit(s) undertaking ship leasing activity in the IFSC
October 04, 2024 – The IFSCA, in accordance with Rule 21B of the SEZ Rules, 2006, has issued guidelines for ship lessors registered with the Authority. These guidelines outline the eligibility criteria for seeking approval to utilize office space, manpower, or both with another entity intending to register with the Authority for ship leasing activities. According to the guidelines, if the proposed entity qualifies as a "group entity" of either the applicant or its parent entity, an application may be submitted along with a one-time fee of $2,500. This application must be made prior to the incorporation of the proposed entity in the IFSC.
Source: GIFT IFSCA website [ Guidelines dated 4th October, 2024]
IFSCA invites comments on consultation paper on "Principles to Mitigate the Risks of Greenwashing in ESG Labelled Debt Securities in the IFSC"
October 04, 2024 – To promote the development of Green Bonds, Social Bonds, Sustainability Bonds, Sustainability-linked Bonds, and other designated bonds—collectively referred to as "ESG (Environmental, Social, and Governance) labelled Debt Securities"—the International Financial Services Centres Authority (IFSCA) has established a regulatory framework under the International Financial Services Centres Authority (Issuance and Listing of Securities) Regulations, 2021. These regulations have since been superseded by the International Financial Services Centres Authority (Listing) Regulations, 2024.
In a short span of time, IFSC Exchanges have experienced a surge in the listing of ESG-labelled Debt Securities, demonstrating how GIFT IFSC is emerging as a preferred platform for Indian corporates to raise sustainable capital from global investors.
To address the risks associated with greenwashing, the IFSCA reviewed recommendations from International Standard Setting Bodies and practices in other jurisdictions. Based on this analysis, it has proposed that issuers of ESG-labelled debt securities in the IFSC adhere to the following five principles:
1. True to Label – Avoid misleading labels and terminology.
2. Screen the Green – Ensure transparency in the methodology for project selection and evaluation.
3. Walk the Talk – Manage and track the use of proceeds.
4. Overall Impact – Quantify negative externalities.
5. Be Alert – Monitor and disclose.
The IFSCA has invited comments, views, and suggestions from the public on the consultation paper.
Source: GIFT IFSCA website [ Consultation Paper dated 4th October, 2024]
IFSCA issues the Master Circular for Credit Rating Agencies
October 01, 2024 – The IFSCA has issued the Master Circular for Credit Rating Agencies, exercising the powers conferred by Sections 12 and 13 of the International Financial Services Centres Authority Act, 2019, and Regulation 72 of the IFSCA (Capital Market Intermediaries) Regulations, 2021. This Master Circular supersedes all circulars and guidelines issued by SEBI prior to October 01, 2020, concerning credit rating agencies registered with the Authority in accordance with Regulation 73(5) of the CMI Regulations.
The Master Circular provides comprehensive information related to the establishment and operation of Credit Rating Agencies registered with the IFSCA under the IFSCA (Capital Market Intermediaries) Regulations, 2021. It covers the registration process, permissible activities, governance, credit rating activities, and more
Source: GIFT IFSCA website [ Master Circular dated 1st October, 2024]
University Of Wollongong (UOW) to Open GIFT City Campus
October 01, 2024 – The University of Wollongong, Australia, is planning to establish its campus at GIFT City by November 2024. The first group of students enrolling at UOW India in November 2024 will benefit from an inaugural scholarship discount. This special scholarship offers a 50% reduction in tuition for all Master's degree programs and a 25% reduction for Graduate Certificate programs during the first trimester of their chosen course at UOW India. The University is committed to providing students with a high-quality and accessible education as they embark on their academic journeys.
Source: The Free Press Journal
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