- 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.
- 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?
- Union Minister for Finance & Corporate Affairs Nirmala Sitharaman chaired a review meeting on the development and growth of India’s maiden International Financial Services Centre (IFSC) at GIFT City, Gandhinagar.