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Gujarat International Finance
GIFT City, or Gujarat International Finance Tec-City, is an integrated development on the outskirts of Ahmedabad, Gujarat, India, designed to be a hub for India's financial services. It is designed to be India's first smart city, with a focus on the finance and IT sectors. The city aims to attract major national and international financial institutions and serve as a hub for India's financial services.
Key highlights of
- 100% tax exemption for 10 years within a 15-year window
- Reduced MAT / AMT of 9% on book profits
- GST exemption
- CAPEX support up to INR 50 Cr
- OPEX support up to INR 20 Cr per year
- Up to 100% reimbursement of employer’s contribution of EPF
- World-class infrastructure
- Strong regulatory framework
- Access to a large pool of skilled talent
- Proximity to international markets
Permissible Sectors in GIFT City
Banks can establish International Banking Units (IBUs) with an IFSCA license, offering an onshore solution for crossborder financial service transactions.
Capital market intermediaries encompass broker-dealers, clearing members, depository participants, investment bankers, portfolio managers, investment advisers, custodians, credit rating agencies, debenture trustees, qualified jewelers and account aggregators.
This covers AIFs, Angel Funds, Family Investment Funds, REITs, INviTs and Mutual Funds operating in GIFT IFSC
Indian and foreign players in the insurance sector such as insurance, Managing General Agents, Lloyd’s, and intermediaries like brokers and loss assessors are covered in this segment.
Bullion means precious metals, including gold, silver or any other precious metal and covers activities like trading in bullion spot delivery contracts and bullion depository receipts.
Financial institution dealing in core activities such as lending, factoring, without accepting deposits from the public and not registered as a banking unit in IFSC
Aircraft financing and leasing (operating / finance lease)
Ship Leasing includes operating lease, hybrid of operating and financial lease of a ship or ocean vessel, engine or any other part of a ship or ocean vessel as a financial product
GICs include units providing support services to entities within its financial services groups such as banks, NBFCs, financial intermediaries among others.
The framework covers FinTech and TechFins servicing clients in the BFSI space
International branch campuses and offshore education centres in GIFT IFSC
Service providers rendering legal, compliance and management consulting services, administration, assets management support services and trusteeship services
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Support for Your Business Journey
At Treelife, we are committed to helping businesses aiming to set up operations in GIFT IFSC. Our involvement begins right from the very first stage – from ideating your business structure to navigating the complexities of tax and regulatory landscapes. We walk you through every milestone, leading up to successful application and approval. We bridge the gap between businesses and regulators, ensuring smooth and efficient interactions throughout the application process. Our strength lies in our adept team. Comprising seasoned chartered accountants, astute lawyers, and proficient company secretaries, we bring unparalleled domain expertise, specially tailored for the startup world.
Frequently Asked Questions (FAQ) about GIFT City
GIFT City is a central business district under construction in Gandhinagar district in Gujarat, India. It is India’s first operational greenfield smart city and international financial services centre. The name “GIFT” stands for “Gujarat International Finance Tec-City”.
GIFT City is located on 1,065 acres of land in Gandhinagar. The city is divided into three zones: the International Financial Services Centre (IFSC), the Special Economic Zone (SEZ), and the Domestic Tariff Area (DTA).
The IFSC is the operational part of GIFT City. It is a regulatory sandbox where financial institutions can experiment with new products and services. The IFSC offers a number of tax and regulatory benefits to businesses, including a 100% tax exemption for the first five years of operation.
The SEZ is a free trade zone where businesses can import and export goods without paying customs duties. The SEZ also offers a number of tax and regulatory benefits to businesses.
The DTA is the area of GIFT City that is not subject to the special tax and regulatory benefits of the IFSC or the SEZ. The DTA is expected to be home to a variety of businesses, including IT firms, manufacturing companies, and retail businesses.
The GIFT City project was announced by the Government of Gujarat in 2007. Construction began in 2009 and is expected to be completed in 2030. The first phase of GIFT City was inaugurated in 2015.
The GIFT City project was conceived as a way to boost the Indian economy by attracting foreign investment and creating jobs. The project is also seen as a way to help India become a global financial hub.
GIFT City is a self-contained smart city with its own power, water, and transportation infrastructure. The city is also a Special Economic Zone (SEZ), which means that it offers a number of tax and regulatory benefits to businesses.
Some of the key features of GIFT City include:
- A state-of-the-art financial infrastructure, including a stock exchange, a clearing corporation, and a depository.
- A world-class IT infrastructure, including a high-speed fiber optic network and a data center.
- A sustainable urban design, with features such as solar power generation and rainwater harvesting.
- A vibrant mixed-use development, with a mix of residential, commercial, and institutional space.
GIFT City is expected to bring a number of benefits to India, including:
- Creation of jobs: GIFT City is expected to create over 100,000 jobs in the financial sector.
- Attraction of foreign investment: GIFT City offers a number of incentives to attract foreign investment, such as a 100% tax exemption for the first five years of operation.
- Promotion of financial innovation: GIFT City is a regulatory sandbox where financial institutions can experiment with new products and services.
- Development of Gujarat: GIFT City is expected to boost the development of Gujarat by attracting investment and creating jobs.
- Increased tax revenue: GIFT City is expected to generate significant tax revenue for the government.
- Improved image of India: GIFT City is expected to improve the image of India as a global financial hub.
GIFT City faces a number of challenges, including:
- Need to attract enough businesses: GIFT City needs to attract enough businesses to make it a viable financial hub.
- Need to ensure sustainability: GIFT City needs to ensure that it is sustainable in the long term, both financially and environmentally.
- Need to address regulatory issues: GIFT City needs to address a number of regulatory issues, such as the lack of a clear regulatory framework for financial technology (fintech).
- Need to compete with other financial hubs: GIFT City will need to compete with other financial hubs in the region, such as Singapore and Dubai.
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