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 hub and India’s first operational smart city, plays a key role in achieving this vision.
Prime Minister Narendra Modi conceived the idea of GIFT City in 2007 as the Chief Minister of Gujarat. His vision was to create a globally benchmarked financial center to rival the renowned financial centers of London, Tokyo, Shanghai, Paris, Singapore and Dubai. Since its conceptualization, GIFT City has progressed rapidly. The support GIFT City has received from the Central and Gujarat Governments has acted as a catalyst in accelerating its growth.
Spread over 886 acres in Gandhinagar, GIFT City comprises a multi-service Special Economic Zone (SEZ) housing India’s first International Financial Services Center (IFSC) and an Exclusive Domestic Tariff Area (DTA). About 261 hectares have been demarcated as SEZ area while 625 hectares have been designated as DTA. The plan is to develop 62 million square feet of built-up area, comprising commercial space (67 percent), residential space (22 percent) and social space 11 percent.
Social infrastructure in the city includes a school, medical facilities, proposed hospital, GIFT City Business Club with indoor and outdoor sports facilities. It also includes integrated well-planned residential housing projects, making GIFT City a true “Walk to Work” city. GIFT is a smart city in every way with various firsts in urban infrastructure.
India’s first International Financial Services Center (IFSC) has started operations in GIFT. The IFSC facilitates the return of financial services and transactions currently carried out in offshore financial centers by Indian legal entities and overseas branches/subsidiaries of financial institutions (FIs) to India by offering a business and regulatory environment comparable to other leading international financial centers , such as London and Singapore. It would give Indian corporations easier access to global financial markets. The IFSC would also complement and promote the further development of financial markets in India.
GIFT IFSC provides services related to capital markets, offshore insurance, offshore banking and asset management, aircraft and ship leasing and ancillary services. It houses two international stock exchanges with a total average daily trading volume of more than 11 billion dollars. The international precious metals exchange will also open soon.
As the dynamic nature of doing business in the IFSC requires a high degree of cross-regulatory coordination in the financial sector, the IFSCA was established as a single regulator with a holistic vision to promote ease of doing business in the IFSC and provide a world-class regulatory environment. The main objective of IFSCA is to develop strong global connectivity and focus on the needs of the Indian economy and serve as an international financial platform.
The pro-business regulatory regime and favorable ecosystem have made GIFT City an ideal location for investment and more than 300 units are already operational in GIFT SEZ and DTA.
The recent announcement by the Indian government to allow campuses of foreign universities in the GIFT IFSC, without domestic regulations, has created a buzz around the world. Many universities in Australia, UK and USA have shown interest in establishing their presence in GIFT IFSC.
Despite the challenges caused by the Covid-19 pandemic around the world, GIFT City has continued to attract domestic and international players.
Prime Minister Narendra Modi’s vision for GIFT City has already taken concrete shape. In the years to come, GIFT City will be a force to reckon with in fintech, data security and finance, making not only Gujarat but the entire country proud.
The writer is the President, GIFT City
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