Union Minister for Finance & Corporate Affairs Smt. Nirmala Sitharaman chairs review meeting at GIFT City, Gandhinagar, in presence of Principal Secretary to the Prime Minister; and Deputy Chief Minister of Gujarat

The Union Ministry of Finance chaired a high-level review meeting at GIFT City, Gandhinagar on May 22, 2026, to assess the progress of India's International ...

What Happened

The Union Ministry of Finance chaired a high-level review meeting at GIFT City, Gandhinagar on May 22, 2026, to assess the progress of India's International Financial Services Centre (IFSC) ecosystem and discuss measures to strengthen its global competitiveness.
The meeting was attended by senior officials from the Prime Minister's Office, the Ministries of Finance and Corporate Affairs, the Gujarat government, the International Financial Services Centres Authority (IFSCA), and GIFT City management.
Key strategic priorities discussed included making GIFT IFSC more cost-effective to attract high-net-worth individual (HNI) investments, leveraging IFSCA's potential to mobilise Sovereign Wealth Funds and Pension Funds, and scaling up operations at the India International Bullion Exchange (IIBX).
GIFT City was characterised as an emerging pillar of India's international financial architecture, reflecting the country's growing economic confidence and global aspirations.
The review forms part of a broader effort to position GIFT IFSC as a competitive alternative to established international financial centres such as Singapore, Dubai (DIFC), and Hong Kong.

Static Topic Bridges

GIFT City and India's First IFSC

Gujarat International Finance Tec-City (GIFT City) is a planned smart city and business district located near Gandhinagar, Gujarat. India's first International Financial Services Centre (IFSC) was set up within GIFT City in December 2015 — marking India's entry into the global offshore financial services market.

GIFT City development began circa 2008; notified as India's first operational IFSC in 2015.
An IFSC is a jurisdiction that provides financial services and products to non-residents and residents (in foreign currency), similar to offshore financial centres.
GIFT IFSC operates as a Special Economic Zone (SEZ) with a distinct regulatory and tax regime — entities operating within the IFSC are treated as non-residents for most domestic regulations.
Key permitted activities: banking (IFSC Banking Units), capital market operations (stock exchanges — NSE IFSC and BSE-IFSC), insurance, fund management, aircraft leasing, ship leasing, global in-house centres (GICs), and bullion trading.
GIFT IFSC hosts the India International Bullion Exchange (IIBX) — India's first bullion exchange — and the NSE IFSC-SGX Connect linking Indian and Singapore derivatives markets.

Connection to this news: The Finance Ministry review signals the Centre's intent to accelerate GIFT IFSC's development as a genuine global financial hub — competing with Singapore and DIFC for fund domiciliation, capital flows, and financial services exports.

International Financial Services Centres Authority (IFSCA)

The IFSCA is the unified statutory regulator for all financial services activities conducted within IFSCs in India. It was established on April 27, 2020, under the International Financial Services Centres Authority Act, 2019.

IFSCA consolidates regulatory oversight previously fragmented across four regulators: the Reserve Bank of India (banking), SEBI (capital markets), IRDAI (insurance), and PFRDA (pension funds) — all of which operate within the IFSC through IFSCA's single-window framework.
Headquartered at GIFT City, Gandhinagar.
Key regulatory instruments: IFSCA (Fund Management) Regulations, IFSCA (Banking) Regulations, IFSCA (Insurance) Regulations, IFSCA (Capital Market Intermediaries) Regulations.
IFSCA may grant approvals and regulate entities that would otherwise require separate approvals from RBI, SEBI, IRDAI, and PFRDA — significantly reducing regulatory friction for global financial institutions.
IFSCA has signed MOUs with multiple international financial regulators including FSRA (Abu Dhabi), MAS (Singapore), and SEC (USA) to facilitate cross-border regulatory cooperation.

Connection to this news: The review meeting's focus on IFSCA's role in mobilising Sovereign Wealth Funds and Pension Funds points to efforts to use IFSCA's unified regulatory framework as a competitive advantage — reducing entry barriers for large institutional investors who would otherwise need to navigate four separate Indian regulators.

India's Capital Account Convertibility Trajectory

Capital account convertibility refers to the freedom to convert domestic financial assets into foreign financial assets and vice versa at market-determined exchange rates. India currently maintains partial capital account convertibility with managed restrictions under the Foreign Exchange Management Act (FEMA), 1999.

The Tarapore Committee (1997, reconvened 2006) recommended a phased roadmap toward full capital account convertibility, conditional on macroeconomic preconditions: fiscal deficit below 3.5% of GDP, inflation control, and financial sector reform.
IFSCs like GIFT City operate as a "ring-fenced" zone where near-full capital account convertibility applies for IFSC-registered entities transacting in foreign currency — without extending this to the broader domestic economy.
This ring-fenced approach allows India to develop offshore financial capabilities, attract foreign institutional investment, and experiment with financial liberalisation without systemic risk to the domestic banking system.
FEMA (2000) replaced FERA (1973), shifting from criminal to civil enforcement and allowing current account convertibility.

Connection to this news: GIFT IFSC's expansion — particularly the push to attract sovereign funds and enable HNI investments — represents incremental progress on India's capital account liberalisation journey within a controlled regulatory perimeter, consistent with the cautious, ring-fenced approach recommended by successive expert committees.

Comparison: Global International Financial Centres

India's GIFT IFSC operates in a competitive landscape of established offshore financial centres, each offering distinct regulatory, tax, and geographic advantages.

Dubai International Financial Centre (DIFC): Established 2004; operates under a common law framework (DIFC Courts); independent financial regulator (DFSA); hosts over 6,000 registered companies; strategic advantage — time-zone bridge between Asia and Europe.
Singapore (MAS-regulated): Asia's premier financial hub; hosts global wealth management, FX trading, and commodity finance; strong rule of law and bilateral investment treaty network.
Hong Kong: Traditional gateway to Chinese capital markets; functions under "one country, two systems" with its own common law framework and independent regulator (SFC/HKMA).
GIFT IFSC's competitive advantages: Tax holidays (10-year corporate tax exemption for units), SEZ status, IFSCA's unified regulatory window, access to Indian capital markets, and India's growing economic scale.
GIFT IFSC's challenges: Still building critical mass of talent, liquidity, and institutional infrastructure; domestic regulatory complexity in some cross-border products; time-zone overlap with Singapore and Dubai.

Connection to this news: The Finance Ministry's focus on "competitiveness and cost-effectiveness" directly addresses GIFT IFSC's positioning challenge — it must offer sufficient regulatory ease and fiscal incentives to compete with DIFC and Singapore for fund domiciliation, aircraft leasing, and bullion trade business.

Key Facts & Data

GIFT City full form: Gujarat International Finance Tec-City
India's first IFSC notified: December 2015 (within GIFT City, Gandhinagar, Gujarat)
IFSCA established: April 27, 2020 under the IFSCA Act, 2019
IFSCA role: Unified regulator replacing the fragmented RBI/SEBI/IRDAI/PFRDA oversight within the IFSC
Key exchanges at GIFT IFSC: NSE IFSC, BSE-IFSC, India International Bullion Exchange (IIBX)
IIBX: India's first international bullion exchange — for gold and silver trade in foreign currency
SEZ status: GIFT IFSC entities treated as non-residents; foreign currency transactions; 10-year tax holiday available
Strategic priorities from the 2026 review: HNI investment attraction, Sovereign/Pension Fund mobilisation, IIBX scale-up, global financial hub positioning
Competing centres: DIFC (Dubai, est. 2004), Singapore MAS, Hong Kong (SFC/HKMA)