About IFSC

• • An International Financial Services Centre (IFSC) is a jurisdiction that provides world class financial services to non-residents and residents in a currency other than the domestic currency (Indian Rupee) of the location where the IFSC is located. 

• Services provided by an IFSC:

• • Fund-raising services for individuals, corporations and governments
  • Asset management and global portfolio diversification undertaken by pension funds, insurance companies and mutual funds
  • Wealth management
  • Merger and acquisition activities among trans-national corporations, etc.

GIFT City

• • India’s 1st IFSC has been set up at the Gujarat International Finance Tec-City (GIFT City) in Gandhinagar. 
  • Operationalized in 2015, it is intended to provide Indian corporates with easier access to global financial markets, and to complement and promote the further development of financial markets in India.
  • It seeks to bring back the financial services and transactions that are currently carried out in offshore financial centers by Indian corporate entities and overseas branches / subsidiaries of financial institutions (FIs) to India by offering a business and regulatory environment that is comparable to other leading international financial centers in the world like London and Singapore. 

• The International Financial Services Centres Authority (IFSCA) was established in 2020 as a unified authority for the development and regulations of IFSCs in India.

Why in News?

• The Department of Economic Affairs (DEA), Ministry of Finance, has amended Foreign Exchange Management (Non-debt Instruments) Rules, 2019 to enable direct listing of Indian Companies at GIFT- IFSC exchanges.
• This initiative, to enable listing of Indian companies in GIFT-IFSC, will reshape the Indian capital market landscape and offers Indian companies, especially start-ups and companies in the sunrise and technology sectors, an alternative avenue to access global capital beyond the domestic exchanges. 
• This is expected to lead to better valuation of Indian companies in line with global standards of scale and performance, boost foreign investment flows, unlock growth opportunities and broaden the investor base. 

https://pib.gov.in/PressReleasePage.aspx?PRID=1999154