The Gujarat International Finance Tec-City (GIFT City) has emerged as a key investment hub for the Indian diaspora, with funds flowing in from Non-Resident Indians (NRIs) and People of Indian Origin (PIOs). According to the International Financial Services Centres Authority (IFSCA) chairman, Mr. K Rajaraman, investments in GIFT City-based funds have now surpassed ₹60,998 crore (US$ 7 billion).
In 2024 alone, NRIs and PIOs remitted over ₹11,24,106 crore (US$ 129 billion) to India, with their global investment footprint estimated to be of a similar magnitude. The fund ecosystem within GIFT City has attracted around 5,000 NRIs, with ₹13,071 crore (US$ 1.5 billion) allocated to banking products and ₹60,998 crore (US$ 7 billion) in investment funds.
To further capitalise on this inflow, dedicated diaspora investment facilities were introduced in 2024. Rajaraman emphasised that India’s 19-million-strong diaspora presents a significant opportunity for fund mobilisation. Unlike traditional rupee-based investments, GIFT City offers financial instruments in foreign exchange terms, making it an attractive destination for overseas investors.
With India aiming to achieve developed nation status by 2047, Rajaraman underscored the need for structural reforms over the next three to five years to align with global financial standards. The IFSCA is actively benchmarking GIFT City against other major international financial centres to enhance its competitiveness.
GIFT City has also witnessed rapid expansion in the banking sector. The 30 banks, including 15 international banks, now have assets under management exceeding ₹6,79,692 crore (US$ 78 billion). Additionally, Indian corporates have raised around ₹4,35,700 crore (US$ 50 billion) from the international banking system within GIFT City.
Recently, a major Indian corporation sought to borrow ₹26,142 crore (US$ 3 billion), indicating growing confidence in GIFT City’s financial infrastructure.
Apart from banking and funds, GIFT City is expanding into new sectors like aviation and shipping. According to IFSCA’s Executive Director, Mr Dipesh Shah, GIFT City has registered 33 aircraft leasing firms, with 198 aviation assets already leased. This diversification aims to establish GIFT City as a comprehensive global business hub.
As financial and corporate activities increase, risk management and cybersecurity remain key concerns. Renowned banking veteran Mr K V Kamath stressed the importance of strong internal controls for startups operating in this evolving financial landscape.
A recent survey by the Institute of Internal Auditors and Protiviti India revealed that two-thirds of chief audit executives consider artificial intelligence, bots, and cybersecurity as top risks. However, only 16% feel highly prepared to handle these emerging threats, highlighting the need for improved governance and compliance frameworks.
GIFT City is rapidly positioning itself as a global financial powerhouse, attracting substantial diaspora investments and corporate borrowings. With the banking, aviation, and shipping sectors gaining momentum, its future as an international financial centre looks promising. However, regulatory reforms and enhanced risk management will be crucial to sustaining long-term growth and stability.
Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.
Investments in the securities market are subject to market risks, read all the related documents carefully before investing.
Published on: Mar 6, 2025, 3:00 PM IST
Team Angel One
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