What is GIFT City?

GIFT City, short for Gujarat International Finance Tec-City, is India’s pioneering global financial and business hub. Developed as a smart city, GIFT City aims to provide a conducive ecosystem for financial services, fintech companies, and global trading institutions.

Established by the Government of Gujarat, it is designed to compete with international financial hubs like Dubai, Singapore, and London. GIFT City is a part of India’s vision to transform its financial sector and attract multinational corporations, startups, and NRIs.

Key features of GIFT City
 

Here are some of the distinct features of GIFT City:

• Modern infrastructure:

Equipped with high-tech facilities, green buildings, and smart city elements.

• Strategic location:

Located between Ahmedabad and Gandhinagar, offering seamless connectivity.

• Global financial hub:

Hosts banking, insurance, capital markets, and fintech businesses.

• Regulatory ease:

Operates under a Special Economic Zone (SEZ), providing tax benefits and compliance flexibility.

Location and development
 

GIFT City is strategically located in Gandhinagar, Gujarat, along the Sabarmati River, making it easily accessible from the major cities. The development of GIFT City was initiated as part of India’s long-term financial sector reforms, focusing on global trade and economic growth.

Spanning 886 acres, the city is being developed in phases to accommodate commercial, residential, and social infrastructure. It is designed to support financial institutions, fintech startups, and IT-enabled services with a futuristic ecosystem.

Key features of GIFT City
 

Here’s what GIFT City has to offer:

1. World-class infrastructure and facilities
 

GIFT City features:

• High-speed connectivity and a well-planned transportation network.
• Smart utility services, including automated waste management and district cooling systems.
• Energy-efficient green buildings, promoting sustainable development.

2. Financial hub and business opportunities
 

• Home to major banks, insurance companies, and stock exchanges.
• Presence of global fintech firms and startups in a regulated financial environment.
• International Bullion Exchange (IIBX), allowing trading of gold and other precious metals.

3. Special Economic Zone (SEZ) Status and Benefits
 

• Businesses in GIFT City enjoy tax exemptions on profits, reduced regulatory restrictions, and foreign exchange benefits.
• 100% income tax exemption for 10 out of 15 years. GIFT IFSC units have the flexibility to choose any 10 consecutive years from a 15-year time frame.

4. Smart City Elements
 

• Green buildings with energy-efficient technologies.
• High-end security systems, intelligent traffic management, and digital governance.
• Sustainable waste management and water recycling systems.

Business opportunities in GIFT City
 

Here’s a list of the leading business opportunities in GIFT City:

1. Financial Services and Banking Institutions
 

• Leading Indian and foreign banks have set up their International Banking Units (IBUs).
• IDFC FIRST Bank’s IBU in GIFT City offers seamless banking solutions to NRIs.

2. Opportunities for Multinational Corporations and Startups
 

• GIFT City attracts global enterprises looking for a low-tax, high-growth business environment.
• Startups and fintech firms benefit from access to international markets and regulatory ease.

3. Role of Fintech, IT, and Global Trading Companies
 

• Companies in blockchain, AI, and digital payments find GIFT City attractive due to its financial regulations.
• The presence of India’s first international bullion exchange boosts global trade.

4. Benefits for Businesses Setting Up in GIFT City
 

• No capital gains tax on specific financial transactions.
• Exemptions on GST for services provided by IFSC units.
• 100% foreign ownership allowed for businesses.

Tax and regulatory benefits
 

Here’s what you need to know about the tax regulations in GIFT City:

1. Tax incentives and exemptions for businesses and individuals
 

• 10-year tax holiday on profits for eligible businesses.
• No Securities Transaction Tax (STT), Commodities Transaction Tax (CTT), or Dividend Distribution Tax (DDT) in GIFT City.

2. Regulatory framework specific to GIFT City
 

• Governed by the International Financial Services Centres Authority (IFSCA), ensuring ease of doing business.
• SEZ regulations allow free movement of foreign exchange, benefiting global investors.

3. Ease of doing business and compliance
 

• Businesses enjoy simplified compliance requirements.
• No restrictions on repatriation of earnings for international companies.

GIFT City and NRIs
 

NRIs looking at GIFT City, here’s what you need to know:

Opportunities for NRIs to invest in GIFT City
 

• NRIs can invest in real estate, financial instruments, and banking services in GIFT City.
• Participation in global stock markets and fintech ventures.

Special benefits for NRIs
 

• No capital gains tax on specified financial transactions.
• Simplified tax compliance for international earnings.
• NRIs can own commercial and residential properties in GIFT City without restrictions.

IDFC FIRST Bank’s International Banking Unit in GIFT City
 

IDFC FIRST Bank’s International Banking Unit offers exclusive banking solutions tailored for NRIs, including savings and investment options. Additionally, they can enjoy seamless fund transfers and forex management and premium wealth management.

Conclusion
 

GIFT City represents India’s vision of becoming a global financial powerhouse, offering unmatched tax incentives, world-class infrastructure, and business-friendly regulations. As an NRI, investing or banking in GIFT City can be highly rewarding, with access to international markets, reduced tax liabilities, and premium financial services.

With the presence of IDFC FIRST Bank’s International Banking Unit, NRIs can efficiently save, invest, and grow their wealth while enjoying the numerous benefits offered by GIFT City’s financial ecosystem.