India’s first International Financial Services Centre (IFSC) at Gujarat International Finance Tec-City (GIFT) achieved another milestone as it crossed the US$ 250 million business transactions mark in six months’ time. The first mark of US$ 100 million was crossed in early February and in two months time, business transactions at IFSC have more than doubled. YES Bank, Federal Bank and ICICI Bank have commenced operations with their IFSC Banking Units (IBUs) and State Bank of India is expected to commence operations soon. Punjab National Bank, Corporation Bank, Kotak Mahindra Bank, IDBI Bank and IndusInd Bank are some of the other players who will begin operating at GIFT IFSC in the near future.
The major tax incentives announced in the Union Budget have made the IFSC at GIFT a globally competitive player and many more BFSI players are swarming to this new global financial hub. The IFSC Banking Unit (IBU) at GIFT IFSC is equivalent to a foreign branch and hence facilitates a bank to function as such from within India. IBU offers facilities like buyers’ credit; external commercial borrowing (ECB); accepting deposits and providing credit facilities to wholly owned subsidiaries/joint ventures of Indian companies registered abroad. IBUs can also undertake factoring/ forfeiting of export receivables; treasury activities like overseas money market operations, investments in overseas securities; and transactions in derivatives and structured products.
Speaking about the big jump in operations at GIFT IFSC, Mr. Ajay Pandey, MD & Group CEO of GIFT City said, “After crossing the US$ 250 million business mark at GIFT IFSC, the next target is US$ 500 million and then the US$ 1 billion mark in coming months. The tax incentives given in the Union Budget have now firmly put GIFT IFSC on the global financial map. After banks, we expect a few insurance companies to start operations soon at GIFT IFSC.”
He further added, “Stock and commodity market operations are the other major focus areas and work is actively on to get this started at GIFT IFSC. Significant volumes of NSE’s Nifty derivatives trading are taking place on the Singapore Stock Exchange. We want GIFT IFSC to start trading in this segment so that this derivatives trading business can come back to India from Singapore.”
Development of completed unique infrastructure, project single window clearance and conducive regulatory environment has made GIFT City a favoured destination for various players to be a part of the city’s development.
Bank of India recently started their branch operations in the GIFT One tower in the Non-SEZ Area of GIFT City. Syndicate Bank, Gujarat State Co-operative Bank and Janalakshmi Bank are already operational in GIFT One tower in GIFT City. With this, more than 10 Banks have started their operations from GIFT City.
GIFT City’s Phase-1 development has seen allotments of over 14 million square feet of built up area (BUA) in the SEZ and Non-SEZ area for development of office towers, residential apartments and social facilities to be developed at an estimated total investment of around Rs 9600 crore. As a part of GIFT City’s Phase-2 development, a built-up area of 1.32 million square feet will be developed by leading real estate companies of India with total proposed investments of Rs 850 crore.
About GIFT Company Limited (www.giftgujarat.in):
Gujarat International Finance Tec-City (GIFT City) is India’s First Global Financial Hub. Part of GIFT City is notified as multi-service SEZ with International Financial Service Centre (IFSC) status which is catering to India’s large financial services potential by offering global firms, world-class infrastructure and facilities. It is attracting the top talent in the country by providing the finest quality of life. It is estimated that GIFT would provide 5 lakh direct and an equal number of indirect jobs which would require 62 million square feet of commercial, residential & social facilities with total investment of about Rs. 78000 crore over next 10 years.