GIFT City

The Gujarat International Finance Tec-City (GIFT City) is India’s first operational smart city and international financial services hub, developed to position India as a leading centre for global finance and trade. Located between Ahmedabad and Gandhinagar in the state of Gujarat, GIFT City represents a major step towards establishing a modern financial ecosystem comparable to global financial hubs such as Singapore, Dubai, and London. It is designed as an integrated development combining world-class infrastructure, regulatory innovation, and advanced technological systems to promote investment, trade, and financial services.

Background and Concept

The concept of GIFT City was first envisioned by the Government of Gujarat in collaboration with the Government of India during the mid-2000s. It aimed to create a financial and technological hub that could serve as a catalyst for India’s emergence in the global financial landscape. The project officially began in 2007, with Gujarat International Finance Tec-City Company Limited (GIFTCL) established as a joint venture between Gujarat Urban Development Company Ltd. (GUDC) and Infrastructure Leasing & Financial Services Ltd. (IL&FS).
Spread across 886 acres, GIFT City is strategically located on the banks of the Sabarmati River, about 12 km from Gandhinagar and 25 km from Ahmedabad International Airport. It is planned as a vertical city, focusing on efficient land use, energy management, and environmental sustainability.
The core objective behind GIFT City’s creation was to bring global financial transactions onshore by offering a regulatory and infrastructural environment at par with international standards, thereby reducing India’s reliance on offshore financial centres such as Hong Kong or Dubai.

Structure and Components

GIFT City is divided into three key zones, each serving distinct yet complementary purposes:

1. Domestic Tariff Area (DTA): This zone operates under regular Indian laws and houses domestic financial and commercial establishments.
2. Special Economic Zone (SEZ): The SEZ is designed to host export-oriented financial services and companies benefiting from fiscal and regulatory incentives.
3. International Financial Services Centre (IFSC): The IFSC functions as the international arm of GIFT City, enabling entities to deal in foreign currency and engage in cross-border financial transactions under a specialised regulatory framework.

The GIFT SEZ Limited acts as the developer and operator of the city’s infrastructure, providing a range of facilities including high-speed data connectivity, automated waste management, energy-efficient buildings, and centralised district cooling systems.

International Financial Services Centre (IFSC)

At the heart of GIFT City lies the International Financial Services Centre (GIFT IFSC), which is India’s first and only IFSC established under the Special Economic Zones Act, 2005. It serves as a platform for global financial institutions to conduct business in foreign currencies and provides a gateway for international capital to flow into India.
The International Financial Services Centres Authority (IFSCA) was established in 2020 as the unified regulator for all financial activities in the IFSC, combining the powers of the Reserve Bank of India (RBI), the Securities and Exchange Board of India (SEBI), the Insurance Regulatory and Development Authority of India (IRDAI), and the Pension Fund Regulatory and Development Authority (PFRDA).
Key activities permitted within GIFT IFSC include:

• Banking and financial services in foreign currency.
• Capital market operations, including trading, clearing, and settlement.
• Insurance and reinsurance activities.
• Asset management and fund services.
• Fintech, aircraft leasing, and maritime finance.

By consolidating these services under a single regulatory framework, the IFSC provides an efficient and globally competitive platform for international financial transactions.

Financial Infrastructure and Developments

GIFT City has rapidly developed into a centre for financial innovation and investment. The city hosts major international and domestic banks, including HSBC, Standard Chartered, Deutsche Bank, and State Bank of India, alongside insurance companies, fintech startups, and capital market entities.
One of the most notable developments within GIFT IFSC is the launch of the Foreign Currency Settlement System (FCSS) in October 2025, inaugurated by Finance Minister Nirmala Sitharaman. The FCSS facilitates real-time settlement of foreign currency transactions within GIFT IFSC, reducing reliance on offshore settlement mechanisms and aligning GIFT City with major global financial centres such as Tokyo, Hong Kong, and Manila.
Other financial market institutions within GIFT City include:

• India International Exchange (India INX) and NSE IFSC, offering international trading platforms.
• CCIL IFSC Limited (CIL), authorised to operate the FCSS under the Payment and Settlement Systems Act, 2007.
• IFSC Banking Units (IBUs), which provide international banking services.

These institutions contribute to an integrated financial ecosystem that supports multi-currency transactions, fund management, and cross-border investments.

Smart City Features and Urban Infrastructure

GIFT City is widely recognised as one of India’s most advanced urban developments, combining sustainable design with cutting-edge technology. It incorporates:

• District Cooling Systems (DCS) to improve energy efficiency.
• Automated Waste Collection System (AWCS) for environment-friendly waste management.
• Smart grid and energy-efficient lighting.
• Underground utility tunnels housing power, water, and communication lines.
• High-speed connectivity and fibre-optic networks.

These features contribute to the city’s vision of a sustainable, liveable, and high-tech financial centre, capable of accommodating over 100,000 residents and 500,000 professionals once fully operational.

Economic and Strategic Significance

The establishment of GIFT City marks a transformative shift in India’s financial and economic strategy. It aims to:

• Bring back offshore financial activities such as derivatives trading and fund management to Indian jurisdiction.
• Attract global investors and institutions by offering internationally competitive tax and regulatory regimes.
• Enhance India’s role in international finance, positioning it as a key link between Asian and Western financial markets.
• Generate employment and boost economic growth in Gujarat and beyond.

GIFT City is also part of India’s “Aatmanirbhar Bharat” (self-reliant India) initiative, focusing on creating indigenous capacity in financial innovation and global service delivery.

Policy and Incentive Framework

To promote participation in GIFT City, the Government of India and the IFSCA have introduced several policy incentives:

• Tax exemptions on specific income for entities operating within GIFT IFSC.
• No capital gains tax on transfer of certain financial instruments.
• Exemption from securities transaction tax, commodities transaction tax, and stamp duty.
• Ease of capital repatriation and simplified foreign exchange regulations.

These incentives, coupled with a transparent regulatory environment, make GIFT City a competitive destination for global businesses seeking an Asia-based financial hub.

Future Outlook

GIFT City is poised for substantial expansion in the coming decade. Plans include:

• Development of global data centres, fintech parks, and knowledge zones.
• Integration with international stock exchanges and digital currency platforms.
• Expansion of aircraft and ship leasing businesses.
• Establishment of a fintech innovation hub to promote research and digital finance solutions.

With growing participation from international financial institutions and the continued support of the Indian government, GIFT City is expected to play a crucial role in shaping India’s position as a global financial powerhouse.

The Gujarat International Finance Tec-City stands as a testament to India’s progressive economic vision and infrastructure development. By combining world-class facilities, innovative regulation, and a sustainable urban model, GIFT City has emerged as a symbol of India’s financial modernisation and global integration, bridging domestic growth with international opportunity.