- An International Financial Services Centre (IFSC) is a jurisdiction that provides world class financial services to non-residents and residents, to the extent permissible under the current regulations, 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.
- 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.
Why in News?
- The Gujarat International Finance Tec-City, popularly known as GIFT City, will expand by roughly 2,300 acres by incorporating four villages in Gujarat’s Gandhinagar district.
- This is GIFT City’s first major expansion since it was conceptualised in 2007, and will expand the project area to more than thrice its existing size, from 1,065 acres to approximately 3,365 acres.