The GIFT International Financial Services Centre ("GIFT IFSC") established in Gandhinagar, Gujarat is India's first international financial services center 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 headquartered 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 are providing transactional updates including a bird's eye view on legal and regulatory updates related to the GIFT IFSC.
PPFAS Alternate Asset Managers IFSC opens a new office at GIFT City
April 30, 2025 – PPFAS Alternate Asset Managers IFSC, a wholly owned subsidiary of Parag Parikh Financial Advisory Services Ltd., has inaugurated its office at GIFT City, Gandhinagar. The firm aims to leverage GIFT IFSC's regulatory advantages to offer global and domestic alternative investment products.
The company is set to launch an inbound Fund of Funds (FoF) that will feed into the Parag Parikh Flexicap Fund, specifically targeting NRIs and foreign investors. The structure simplifies access by eliminating the need for PAN, NRO/NRE accounts, or FPI registration, allowing investment in USD with no repatriation restrictions.
PPFAS also plans to introduce outbound fund structures and Portfolio Management Services (PMS) from GIFT City, reinforcing its position as a cross-border investment platform.
Source: The Economic Times [dated April 30, 2025]
Net Worth Requirement for Customers dealing with various products on IIBX has been removed
April 29, 2025 – The Circular herein amends the earlier Circular dated 25th August, 2021, with regards to the Operating Guidelines on Bullion Clearing Corporation, Bullion Depository and Vault Manager issued by IFSCA, particularly dealing with the definition of 'Customer' in Annexure I specifying the net worth of the respective Customers.
The customer's net worth requirement, as provided in the Circular mentioned above, has been removed to broaden the base of participation across various products offered on India International Bullion Exchange (IFSC) Limited ("IIBX"). However, the net worth requirement for Qualified Suppliers and Qualified Jewellers vide Circulars dated 18th August 2022 and 11th December 2023, respectively, shall continue to apply.
Source: GIFT IFSCA website [Circular dated April 29, 2025]
IBAI launches dedicated chapter at GIFT City to boost growth in the insurance broking sector
April 29, 2025 - The Insurance Brokers Association of India (IBAI) has announced the launch of its dedicated chapter at the International Financial Services Centre (IFSC), GIFT City. This strategic move underscores IBAI's commitment to advancing insurance broking in both domestic and international markets, leveraging GIFT City's position as a global financial hub. With insurance brokers contributing nearly 40% to India's general insurance business and rising involvement in the life insurance sector, IBAI's presence at IFSC is poised to accelerate sectoral growth and deepen industry participation in global insurance markets.
Source: GIFT website [News dated April 29, 2025]
CMA CGM welcomes first boxship flying Indian flag at Nhava Sheva container terminal
April 28, 2025 - CMA CGM Group, French logistics and shipping major, has attained an important milestone as the Nhava Sheva Freeport Terminal (NSFT) received the first India-flagged containership to be registered by a foreign major shipowner, CMA CGM Vitoria. As a further reaffirmation of its commitment to India for the long term, three other vessels are to be registered under the Indian flag by CMA CGM. The Group has also become the first overseas shipping company to register a container vessel at Gujarat International Finance Tec (GIFT) City. These advancements are a testament to CMA CGM's strategic emphasis on India and its commitment to be inclusive in the India-Middle East-Europe Economic Corridor (IMEC).
Source: GIFT website [News dated April 28, 2025]
IBPC Dubai Conclave Highlights Strategic India-UAE Ties, Former President Kovind Delivers Keynote
April 26, 2025 - The Indian Business and Professional Council (IBPC) Dubai marked its 22nd anniversary on April 25, 2025, with a high-level conclave at the Taj Exotica, showcasing the increasing strategic partnership between India and the UAE. The occasion included a keynote by former President of India Ram Nath Kovind and addresses by the Indian Consul General in Dubai, emphasizing increasing cooperation in trade, education, and investment. Former President Kovind praised the contribution of the Indian diaspora towards strengthening bilateral relationships and highlighted cooperation in new areas like green growth, infrastructure, and space and referred to prominent developments such as the Abu Dhabi Investment Authority investing USD 1 billion in India's National Infrastructure Investment Fund and opening a new office in GIFT City.
The Consul General noted the rapid pace of engagement, including the launch of IIT Delhi's Abu Dhabi campus and bilateral trade exceeding USD 100 billion well ahead of the 2030 target. He also spotlighted the UAE-India Friendship Hospital as a landmark in healthcare collaboration. IBPC unveiled the Viksit Bharat Series to bolster economic ties with Indian states and reaffirmed its focus on CEPA, sustainability, and the digital economy. A performance by disabled artists named "Miracle on Wheels" provided a cultural highlight. IBPC Secretary General Dr. Sahitya Chaturvedi stressed that the conclave struck a note for sustained cooperation in the areas of trade, technology, and cultural diplomacy.
Source: GIFT website [News dated April 26, 2025]
Clarifications on the Fee structure for the entities undertaking or intending to undertake permissible activities in IFSC or seeking guidance under the Informal Guidance Scheme
April 23, 2025 - The IFSCA has issued this clarification to provide further guidance on the fee structure outlined in Circular No. IFSCA-DTFA/1/2025 dated April 08, 2025. The update addresses concerns raised by stakeholders and incorporates a series of clarificatory and corrective measures intended to enhance regulatory clarity and operational efficiency.
Notably, a processing fee of USD 500 will now apply to any modifications made to scheme documents by Fund Management Entities (FMEs). Additionally, it has been clarified that late submission fees for periodic returns will be charged on a per-activity basis for each regulated entity. Concerning Key Managerial Personnel (KMP) changes within FMEs, a fee of USD 250, or as specified in Schedule I of the original fee circular (whichever is lower), will be applicable for every such intimation.
In addition to this, Payment Service Providers (PSPs) and Payment System Operators (PSOs), application and recurring fees detailed under Schedules 1B and 1C are to be paid for each activity undertaken. Specifically, significant PSPs will be charged an annual fee of USD 10,000 per activity. Clarification has also been provided for finance companies, wherein the applicable fees shall be levied separately for each permissible core activity under Regulation 5(1)(ii)(a) to (d) of the IFSCA (Finance Company) Regulations, 2021.
Source: GIFT IFSCA website [Circular dated April 23, 2025]
Clarification on conducting Customer Due Diligence (CDD) and Maintenance of Supply Chain Integrity by the Vault Managers
April 22, 2025 – The IFSCA has issued a circular outlining the obligations of Vault Managers operating within the IFSC in relation to Customer Due Diligence ("CDD") and bullion supply chain integrity. The circular draws reference from the IFSCA (Anti-Money Laundering, Counter-Terrorist Financing and Know Your Customer) Guidelines, 2022, and the Operating Guidelines on Bullion Exchange, Bullion Clearing Corporation, Bullion Depository, and Vault Manager dated August 25, 2021.
Vault Managers need to perform proper due diligence on all customers who are the final beneficial owners of Bullion Depository Receipts (BDRs) and this is applicable across the board, including overseas buyers and suppliers, entities that will be operating within GIFT-IFSC, domestic players such as India-UAE CEPA TRQ holders and Qualified Jewellers, and members of the Bullion Exchange. While Vault Managers might be dependent on CDD undertaken by the Bullion Depository, such dependency does not exempt them from their regulatory obligation to verify and determine independently the credentials of all bullion customers themselves.
To facilitate effective compliance, Vault Managers are urged to liaise with Bullion Depositories to obtain full customer records and due diligence documentation that has been verified. With regard to cross-border logistics, Vault Managers are required to enter into formal arrangements with foreign logistics service providers, which are to clearly mandate such partners to perform CDD on bullion suppliers in accordance with either the FATF guidelines or the regulatory regime of the home jurisdiction of the supplier, whichever is stricter.
As far as supply chain integrity is concerned, the circular stipulates that bullion should be in the constant custody of the Vault Manager or its approved logistics partners at all stages of transit, from procurement at a foreign refinery to ultimate vaulting. The condition has to be well spelled out in formal contractual agreements to guarantee there are no breaks in the chain of custody. Furthermore, the Bullion Depository is assigned the role of ensuring compliance by Vault Managers with these requirements.
Source: GIFT IFSCA website [Circular dated April 22, 2025]
Mirae Asset launches Global Fund at GIFT City for overseas ETF exposure
April 21, 2025 - Mirae Asset Investment Managers (India) has introduced the Mirae Asset Global Allocation Fund IFSC, a Category III Alternative Investment Fund (AIF) at GIFT City. This closed scheme with a corpus target of USD 200 million provides unique investment opportunities to accredited investors with a minimum commitment of USD 151,000. The fund has an investment theme of global equity ETFs, predominantly in developed markets and emerging themes such as AI and semiconductors. Investors may invest through the Liberalized Remittance Scheme (LRS) or Overseas Portfolio Investment (OPI) route. The scheme seeks to invest up to 100% of its NAV in globally diversified ETFs, offering exposure to broad market indices and emerging themes.
Source: CNBC TV18 [dated April 21, 2025]
Govt eases liquor permit rules within the GIFT City
April 19, 2025 - The Gujarat government has made major relaxations to the liquor permit system in GIFT City, further opening up provisions under the Gujarat Prohibition Act, 1949. In the notification issued, the Home Department modified major clauses of its previous December 2023 order, relaxing access to liquor permits for staff and visitors of firms operating in GIFT City. The new policy abolishes the compulsory position of a 'Recommending Officer' and enables employees to submit Form A-1 directly to an officer authorized by the GIFT City Managing Director. On verification, a 'liquor access permit' card will be provided, and employees will be able to recommend up to five visitors through Form A-2, subject to them following such visitors into designated wine and dine areas. The new framework also allows regular and temporary permit holders to be brought under 'group permits' in the campus. These steps are intended to bring about a business-friendly environment with international standards while maintaining regulatory control, and are viewed as being part of the state's overall strategy to bring in international talent and investment.
Source: GIFT website [News dated April 19, 2025]
IFSCA (KYC Registration Agency) Regulations, 2025
April 17, 2025 - The IFSCA has introduced the IFSCA (Know Your Customer Registration Agencies) Regulations, 2025 ("KRA Regulations"). These regulations seek to simplify the centralized KYC process for financial transactions in IFSC so as to comply with international anti-money laundering (AML) and combating financing of terrorism (CFT) standards.
Organizations interested in being registered as KYC Registration Agencies (KRAs) need to make an application to IFSCA in the given format. They should be companies incorporated in the IFSC, but SEBI registered KRAs can have a fully owned subsidiary or branch in the IFSC. The minimum net worth of USD 1 million is required, with parent entities guaranteeing this requirement in the event of branches.
All the directors, key managerial personnel, and compliance officers have to be 'fit and proper' persons, possessing integrity, financial soundness, and a clean legal record. KRAs have to appoint a Principal Officer and Compliance Officer located outside the IFSC, both appropriately qualified according to regulatory standards. Registration remains valid unless suspended, cancelled, or surrendered with IFSCA's approval. KRAs must comply with a Code of Conduct, act in clients' best interests, maintain confidentiality, avoid conflicts of interest, and ensure robust grievance redressal and internal controls.
Systems should facilitate real-time interoperability with other KRAs (domestic and foreign), allowing for easy sharing and verification of KYC information. Any change in control shall be subject to prior approval (in case of IFSC-incorporated KRAs) or notification within 15 days (in case of branches).
KRAs have to remit prescribed charges and carry out annual statutory audits, reporting to IFSCA by 30th September. Surprise audits may also be triggered. KRAs are obligated to validate, renew, and keep client KYC information confidential, whereas regulated institutions have to upload information within three working days and are barred from using the information for any purposes other than compliance. Subject to client permission, KRAs can disclose information to other regulators or government portals such as CKYCR, as per data protection legislation. IFSCA can inspect, and KRAs have to give complete access to records, staff, and systems. Non-compliance can draw regulatory penalties, including suspension or cancellation of registration.
Source: GIFT IFSCA website [Regulation dated April 17, 2025]
IFSCA (Capital Market Intermediaries) Regulations, 2025
April 17, 2025 - The IFSCA has notified the IFSCA (Capital Market Intermediaries) Regulations, 2025, establishing a comprehensive framework for the registration, regulation, and supervision of capital market intermediaries operating within IFSC.
The regulations define various categories of capital market intermediaries and set out the process for registration, including eligibility criteria and grounds for refusal. Once granted, registration remains valid perpetually unless suspended or cancelled by the Authority. Intermediaries are subject to general obligations such as compliance with a prescribed code of conduct, record maintenance, prompt reporting of material changes, grievance redressal, and the establishment of dispute resolution mechanisms. They must also implement business continuity plans, cybersecurity frameworks, risk management systems, and conduct regular compliance audits.
Specific obligations are prescribed for distinct categories of intermediaries including broker-dealers, clearing members, credit rating agencies, custodians, and debenture trustees. The regulations further empower IFSCA to conduct inspections, call for information, and take enforcement action, including suspension or cancellation of registration. They provide for delegation of powers, relaxation of provisions in specific cases, and include mechanisms to resolve procedural difficulties. Additionally, the regulations repeal earlier applicable circulars and regulations, with savings clauses to preserve actions taken under them. The accompanying Schedules specify minimum net worth requirements for various intermediaries and detail a unified code of conduct.
Source: GIFT IFSCA website [Regulation dated April 17, 2025]
Amendment to the circular titled "Framework for enabling Ancillary Services at International Financial Services Centres"
April 17, 2025 - The IFSCA has issued an important amendment to its Framework for enabling Ancillary Services at International Financial Services Centres, originally notified via circular dated February 10, 2021. This circular supersedes previous circulars and is a reflection of inputs received from market participants and changing regulatory requirements within the IFSC environment.
The new framework encompasses a wider scope of trusteeship services such as Alternative Investment Funds, Investment Trusts like InvITs and REITs, Family Investment Funds (FIFs), Security Trust arrangements, and escrow agency roles. Trusteeship services can also be provided to other schemes, such as retail schemes introduced by Fund Management Entities (FMEs) registered under the IFSCA (Fund Management) Regulations, 2025. All such services are required to be provided in compliance with relevant regulatory requirements, including adherence to the specified 'fit and proper' standards and code of conduct.
Source: GIFT IFSCA website [Circular dated April 17, 2025]
Uni-versal appeal: GIFT City in Gujarat to house foreign universities in Rs 450 crore central hub
April 17, 2025 - GIFT City will have India's first International Branch Campus (IBC) hub, for foreign universities, in a ₹450 crore project. Situated at the entrance of GIFT City's SEZ the skyscraper academic facility will accommodate classrooms, labs, libraries, and office areas, made to international standards.
The initiative hopes to establish GIFT City as a world-class destination for overseas education, to complement its position as a global financial centre. Authorities at GIFT City have initiated an international architectural design contest for the IBC with the themes of smart infrastructure, sustainability, and learning environments of the future. The proposed building will cover an area of over 10.8 lakh sq. ft., having a basement and superstructure of up to 120 meters, in accordance with aviation standards.
Source: GIFT website [News dated April 17, 2025]
Air India makes $300 million payment to plane lessors via GIFT City arm
April 17, 2025 - Air India Group has paid around $300 million to aircraft lessors in the last two months via its wholly owned leasing arm, AI Fleet Services IFSC (AIFS), in GIFT City, Gujarat. The payments were made in two tranches: an initial $50 million and a follow-up $250 million earlier this month. The strategic step reflects the determination of Air India to harness India's IFSC framework to manage its aircraft leasing business with a view to aligning the government's vision to make GIFT City an international aviation finance hub.
Source: GIFT website [News dated April 17, 2025]
IndiGo inaugurates its new office in GIFT City, Gujarat
April 15, 2025 - IndiGo has opened a new office in GIFT City under its wholly-owned subsidiary, InterGlobe Aviation Financial Services IFSC Private Limited (GCE). This move is aimed at increasing the aircraft financing capacity of GCE as per the growth plans of the airline. GCE, authorized by the International Financial Services Centres Authority (IFSCA) in June 2024, has already funded more than 30 Airbus A320neo family aircraft and some ATR aircraft for IndiGo.
The office inauguration was attended by IndiGo's top leadership, including the CEO and CFO, as well as representatives of international leasing companies. IndiGo's CEO Pieter Elbers emphasized that the new office facilitates the airline's growth strategy and is in line with the vision of the government to establish a self-sustaining aircraft leasing and financing ecosystem in GIFT City.
Source: GIFT website [News dated April 15, 2025]
Dentons advises Axis Bank on India's first domestic USD-denominated aircraft financing
April 15, 2025 – Dentons has advised Axis Bank on a landmark USD denominated aircraft financing transaction which is India's first such deal executed by a domestic bank. The transaction, facilitated through Axis Bank's International Banking Unit (IBU) at GIFT City, supports the acquisition of 34 training aircraft by AI Fleet Services Ltd (AIFS), a wholly owned subsidiary of Air India, for its upcoming pilot training academy in Amravati, Maharashtra.
This pioneering deal underscores the growing role of Indian financial institutions in aviation finance and highlights GIFT City's emerging status as a global financial hub. Dentons' cross-border team, led by partners Namita Das and Madhur Verma in India and supported by Donal Keane and Sarah Dyke from the Dublin and London offices, provided comprehensive legal counsel to successfully structure and execute the transaction.
Source: GIFT website [News dated April 15, 2025]
Guidelines on setting up and operation of International Trade Finance Service Platform
April 11, 2025 - The IFSCA has released an updated and robust framework for the establishment and operation of the International Trade Finance Service Platform (ITFS), effective April 11, 2025. The revised framework supersedes the earlier guidelines issued on July 9, 2021, and aims to strengthen the institutional, operational, and regulatory foundations of trade finance in IFSC.
Applicants must incorporate a new company under the Companies Act, 2013 and register as a Finance Company under the IFSCA (Finance Company) Regulations, 2021. Eligibility criteria include a minimum of three years' experience in relevant sectors, establishment of infrastructure within IFSC, and a sound compliance record. A minimum capital requirement of USD 200,000 is mandated, along with robust technological capabilities including real-time processing, invoice validation, electronic proofing, and secure communication systems. Platforms must also implement strong cybersecurity measures, a business continuity plan, and real-time surveillance mechanisms.
The regulatory framework requires books of account to be maintained in USD, while trade settlements can occur in any permitted foreign currency, including INR under the amended FEMA (Deposit) Regulations, 2016. This flexibility enhances the global appeal and utility of ITFS platforms.
Source: GIFT IFSCA website [Circular dated April 11, 2025]
Amendment to the circular titled "Guidelines on setting up and operation of International Trade Finance Service Platform" dated December 23, 2024.
April 11, 2025 - The IFSCA has amended the "Guidelines on setting up and operation of International Trade Finance Service Platform (ITFS)," originally issued on December 23, 2024. The amendments address feedback received from ITFS operators and market participants and pertain specifically to clause 12(2) of the Guidelines, which sets out eligibility requirements for financiers participating on the platform.
The term Assets Under Management (AUM) under item (i) was explained to mean the total market value of financial assets which are owned or managed by a financier on clients' behalf. Item (iii) now makes it obligatory for financiers to prove credit or debt recovery capacities, either within or by way of outsourcing. Item (iv) requires that financiers should be incorporated entities carrying on the business of factoring. A new item, (v), has been included, which prohibits financiers and shareholders of more than 10% of share capital from originating in jurisdictions that have been identified by the Financial Action Task Force (FATF) as "High Risk subject to call for action." These changes are intended to increase regulatory clarity, promote competence among financiers, and counter risks from high-risk jurisdictions.
Source: GIFT IFSCA website [Circular dated April 11, 2025]
UK's Coventry University gets nod for campus in GIFT City; to begin academic session from 2026
April 09, 2025 – Coventry University has been given in-principal approval by the IFSCA to set up a campus in GIFT City, Gujarat the first English university to have received this approval. Opening in 2026, the campus will introduce BSc (Hons) programmes in International Business Management and Business and Finance. The development is part of Coventry's wider global reach and is geared towards offering Indian students access to UK-quality education in the vicinity. Unveiled during the 13th UK-India Economic and Financial Dialogue, the move is emblematic of the increasing UK-India educational collaboration and facilitates the developing academic hub of GIFT City.
Source: GIFT IFSCA website [Circular dated April 09, 2025]
Transition to IFSCA (Fund Management) Regulations, 2025
April 8, 2025 - The IFSCA, pursuant to the publication of the IFSCA (Fund Management) Regulations, 2025 in the Official Gazette on February 19, 2025, has formally repealed the Fund Management Regulations, 2022 and introduced transitional provisions for fund managers. Notable updates under the 2025 Regulations include the validity of the Private Placement Memorandum (PPM) for such schemes has been extended from six to twelve months. Additionally, the minimum corpus requirement has been reduced to USD 3 million from USD 5 million. Transition provisions allow schemes filed under the FM Regulations, 2022, to be launched under the new regime if they were recorded by IFSCA within six months prior to February 19, 2025, or had obtained approval for PPM extension that ends on or after that date. A one-time extension opportunity is also available for FMEs whose PPMs expired before February 19, 2025, provided they refile within three months of the circular's date, make no material changes (except those aligning with the new regulations), and pay 50% of the standard filing fee. Upon approval, such schemes will receive an additional six-month validity. Finally, while FMEs must inform IFSCA of material changes and pay processing fees, no fee will apply if changes result from regulatory updates or actions initiated by IFSCA.
Source: GIFT IFSCA website [Circular dated April 8, 2025]
Fee structure for the entities undertaking or intending to undertake permissible activities in IFSC or seeking guidance under the Informal Guidance Scheme
April 8, 2025 - The IFSCA has introduced a revised and comprehensive fee structure applicable to all applicants, Regulated Entities (REs), and persons seeking guidance under the IFSCA Informal Guidance Scheme, 2024. This circular consolidates and supersedes several earlier circulars and aims to standardize and streamline the financial obligations associated with obtaining regulatory approvals and maintaining ongoing compliance within IFSC.
Under the revised framework, fees are categorized across
multiple heads including application fees, license/registration
fees, flat and conditional recurring fees, activity-based charges,
processing fees, late payment fees, and informal guidance fees. The
circular details pro-rata fee computations for newly granted
authorizations and mandates timely remittances to avoid regulatory
rejection or late fee penalties. Conditional recurring fees are
calibrated against objective metrics such as turnover or employee
count, and are subject to annual reconciliation based on actual
performance data.
Entities seeking substantive modifications to their licenses or
regulatory status, including expansions, mergers, or changes in
control, must now pay a processing fee equal to 20% of the original
registration fee. Additionally, fees for delays in regulatory
filings or payments are clearly outlined, with interest and monthly
penalties applicable for non-compliance. The circular also
introduces a structured refund and waiver policy and specifies
permissible payment modes, including remittances in USD and INR,
depending on the status of the applicant.
Source: GIFT IFSCA website [Circular dated April 8, 2025]
GAIL sets up finance arm at GIFT City to handle global treasury and ship leasing
April 8, 2025 – GAIL (India) Ltd has set up a wholly owned subsidiary, GAIL Global IFSC Ltd, in the IFSC at GIFT City, Gujarat. The subsidiary was incorporated on April 7, 2025, with an authorized share capital of ₹17 crore and an initial paid-up capital of ₹8.5 crore. The subsidiary is expected to diversify GAIL's activities away from its traditional natural gas business. The company is permitted to undertake Global and Regional Corporate Treasury Centre operations and ship leasing activities, representing a strategic foray into financial services. The action is in sync with GAIL's goal to maximize capital management and seek new revenue opportunities in a tax-friendly ecosystem. The incorporation of GAIL Global IFSC Ltd reinforces the company's focus on deepening its global financial presence via GIFT City's infrastructure and regulatory ecosystem.
Source: CNBC TV18 [dated April 8, 2025]
Revision to the requirement of meetings of the governing body of the IBUs in IFSC - Amendment to Governance Directions Module of GEN Directions - V 5.0 (IFSCA Banking Handbook)
April 8, 2025 - The IFSCA has revised the governance requirements applicable to Indian Banking Units (IBUs) operating in IFSC. The amendment updates the meeting frequency requirement for the governing bodies of IBUs, specifying that they must meet at least once per quarter in a financial year, while allowing additional meetings as necessary. This amendment replaces the previous directive outlined in Module No. 2, of the IFSCA Banking Handbook: General Directions – V5.0.
Source: GIFT IFSCA website [Circular dated April 8, 2025]
Framework for Ship Leasing, updated as on April 07, 2025
April 7, 2025 - The IFSCA, has issued an updated Framework for Ship Leasing, with effect from April 7, 2025. The revised framework applies to Finance Companies and Finance Units established in IFSC and seeking to engage in ship leasing activities, encompassing both financial and operating leases. The framework introduces a detailed regulatory framework covering registration, operational conduct, and governance standards for lessors.
Entities that wish to engage in ship leasing need to be registered with IFSCA as a Finance Company or Finance Unit, and they should have a minimum capital base of USD 200,000 or equivalent. Promoters and directors should fulfill fit and proper requirements as stipulated under the framework. Registered entities may carry on a range of leasing-related activities. These involve ship operating and finance arrangements, sale and leaseback transactions, and the provision of ancillary services like management of crew and ships. Ships can be leased to Indian and foreign lessees. Institutions are governed by prudential requirements like a limitation on the leverage ratio of ten times their owned capital. They are required to use sound risk management principles and enter into all transactions at arm's length.
Organizations are required to file quarterly reports on their ship leasing activities and report any material developments to IFSCA. They are also expected to follow Know Your Customer (KYC), Anti-Money Laundering (AML), and Countering the Financing of Terrorism (CFT) requirements. Books of accounts must be properly maintained and audited annually, as well as comply with relevant laws, such as the Merchant Shipping Act.
IFSCA still exercises supervisory powers and can do so by inspecting or seeking information as required. Those already participating in ship leasing businesses under the previous regime need to conform to this new framework within six months of notification.
Source: GIFT IFSCA website [Circular dated April 7, 2025]
Framework for Finance Company/Finance Unit undertaking the activity of Global/ Regional Corporate Treasury Centres
April 4, 2025 - The IFSCA has issued a detailed framework for regulating Finance Companies and Finance Units undertaking the activity of Global/Regional Corporate Treasury Centres (GRCTC) within IFSC. The new framework will be applicable to those entities which want to be registered as a finance company or finance unit in GIFT IFSC. Some of the requirements are keeping minimum owned funds of USD 200,000, having at least five skilled professionals (including head of treasury and compliance officer), and meeting infrastructure, governance, and fit-and-proper requirements. Organizations need to apply through the SWIT portal and can be established as a company or branch, domestic or foreign. On obtaining registration, they have to start functioning within six months, extendable by two months.
Allowed treasury operations are raising of capital, inter-company borrowing, credit facilities, investment in financial instruments, foreign exchange and derivative transactions, factoring, forfaiting, re-invoicing, management of liquidity, insurance and pension obligation management, financial advisory, and being a holding company. Factoring and forfaiting services need extra registration. Activities have to be carried out in designated foreign currencies, and adherence to AML/CFT/KYC standards is necessary. A framework of corporate governance and risk policies should exist with prior approval being necessary for changes in control that are more than 20%. The fee structure consists of an initial application fee of USD 1,000, a registration fee of USD 12,500, and an annual recurring fee of USD 25,000.
Source: GIFT IFSCA website [Circular dated April 4, 2025]
Amendment to the 'Guidelines on Corporate Governance and Disclosure Requirements for a Finance Company
April 4, 2025 - The IFSCA has issued an amendment to the existing 'Guidelines on Corporate Governance and Disclosure Requirements for a Finance Company' which was originally notified on August 9, 2021. This amendment has been introduced to align the Guidelines with the Finance Company Regulations, 2021 (as amended up to July 1, 2022), and to bring them in conformity with the recently notified 'Framework for Finance Company/Finance Unit undertaking the activity of Global/Regional Corporate Treasury Centres'.
Under the amended provision, the generic corporate governance requirements outlined in Part I of the Guidelines shall apply to all finance companies registered under Regulation 3 of the Finance Company Regulations, with the specific exclusion of those engaged in Global or Regional Corporate Treasury Centre activities. Similarly, the detailed governance norms set out in Part II shall apply only to finance companies undertaking one or more core activities either independently or in conjunction with non-core activities again excluding Corporate Treasury Centres.
Source: GIFT IFSCA website [Circular dated April 4, 2025]
Guidelines on Corporate Governance and Disclosure Requirements for a Finance Company
April 4, 2025 - The IFSCA has issued an updated circular, setting out revised guidelines on corporate governance and disclosure requirements applicable to finance companies operating within IFSC. The guidelines are divided into two components. Part I, with generic provisions, is applicable to all finance companies registered with IFSCA except those that operate solely as Global/Regional Corporate Treasury Centres and Part II has governance requirements for entities that are engaged in core financial activities.
Key requirements are the development of a board-approved corporate governance structure, the disclosure of governance on websites and in annual reports, and the implementation of a strong "fit and proper" evaluation process for board members.
Finance businesses need to also designate a senior management-level compliance officer who reports at the board level, and form suitable board-level committees like audit, risk, and nomination committees, as a function of scale and complexity of operations. The circular also mandates that policies for related party transactions, director training structured on the basis of board member duties, responsibilities, and commitment to regulatory compliance be put in place, and a deed of covenants be executed by board members describing their duties, responsibility, and commitment to regulatory compliance.
Disclosure requirements have been greatly enhanced, requiring finance companies to disclose detailed operating and financial information to their boards, stakeholders, and regulators. These include quarterly performance, annual operating plans, material adverse events, exposure to non-performing assets, and regulatory fines, among others. Mandatory disclosures need to be prominently displayed on the company's website and included in annual financial reports, thus increasing transparency and investor confidence.
Source: GIFT IFSCA website [Circular dated April 4, 2025]
WhiteOak Capital set to launch a Category-III GIFT City fund
April 3, 2025 – WhiteOak Capital will be opening a Category-III Alternative Investment Fund (AIF) on its GIFT City platform. Managed by Ashoka WhiteOak Capital Management (GIFT) LLP, a registered non-retail Fund Management Entity, the fund will serve as an outbound feeder to the WhiteOak Emerging Markets Ex-India Fund.
Housed before in Dublin and not available to Indian distributors, the fund is now accessible locally through mutual fund distributors and banks. Indian investors may invest through the Liberalized Remittance Scheme (LRS) or Overseas Portfolio Investment (OPI) channels.
This is WhiteOak's second GIFT City initiative after the launch of its India Multi Cap Fund. The firm aims to take its GIFT City offerings to retail investors in the future.
Source: GIFT website [News dated April 3, 2025]
Standard Chartered Bank expands its presence in GIFT City
April 3, 2025 – Standard Chartered Bank has increased its presence in GIFT City by shifting to a bigger office space, reflecting its commitment to India's global financial hub. The new office was launched by P.D. Singh, CEO for India & South Asia, with the presence of IFSCA, GIFT City, and British High Commission's senior officials.
The expansion comes on the back of a 150% rise in the bank's funded assets at GIFT City, spurred by growth in corporate banking, trade finance, and financial markets. The growth is part of the bank's strategy to enable global clients and help GIFT City become a leading global financial hub.
Source: GIFT website [News dated April 3, 2025]
Direction for all Regulated Entities
April 3, 2025 - The IFSCA has issued a critical compliance directive to all regulated entities operating within IFSC. The circular addresses instances where certain entities have been found operating without holding valid registration, authorisation, or a Letter of Approval (LoA) under the Special Economic Zones Act, 2005 (SEZ Act), in contravention of the International Financial Services Centres Authority Act, 2019 (IFSCA Act) and the SEZ Act.
In order to ensure the orderly development of the financial services framework in the IFSC, IFSCA has now directed that all regulated institutions shall at all times hold valid and subsisting documentation under both regulatory systems. In particular, persons are to have: (i) a current Certificate of Registration (CoR), license, recognition, authorisation letter, or any other equivalent approval in accordance with relevant IFSCA regulations; and (ii) a current LoA under the SEZ Act, 2005. The circular further adds that LoAs generally have a one-year validity in situations where business has not yet started, and five years thereafter. Delays in obtaining or renewing the LoA can trigger regulatory enforcement measures, such as cancellation of any registration, licenses, or authorisations already issued by IFSCA.
In addition, the circular makes it clear that the obligation to keep a valid LoA shall be considered to be part of the terms and conditions of all past and future approvals issued under the IFSCA regulatory regime. Failure to comply with these guidelines can thus be a violation of license terms and can attract proper regulatory penalties.
Source: GIFT IFSCA website [Circular dated April 3, 2025]
Revision in reporting formats for Fund Management Entities in IFSC
April 3, 2025 - The IFSCA has issued a circular notifying revisions in the reporting formats for Fund Management Entities (FMEs) operating within IFSC. This release is subsequent to previous circulars dated May 31, 2023, and November 3, 2023, which initially set out and subsequently revised the reporting standards. The new formats are designed to enhance regulatory supervision by including comprehensive data on retail schemes, restructuring tables for ease of understanding, and harmonizing reporting with the recently notified IFSCA (Fund Management) Regulations, 2025.
Source: GIFT IFSCA website [Circular dated April 3, 2025]
Fee structure for Payment System Operators/ Applicants desirous to setup an PSO in IFSC
April 2, 2025 - The IFSCA issued a circular dated April 2, 2025, outlining the fee structure applicable to Payment System Operators (PSOs) or applicants intending to establish a PSO within the IFSC. This circular prescribes a detailed fee framework including application fees, authorisation fees, recurring fees, and conditional processing fees. It categorizes different types of PSOs, such as card networks, trade repositories, and LEI issuers, with specific fee amounts and conditions for each.
Source: GIFT IFSCA website [Circular dated April 2, 2025]
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