India’s Gujarat International Finance Tec-City — better known as GIFT City — is finally catching the eye of global asset managers, more than a decade after it was launched, according to experts and company announcements.
The financial center, located in Prime Minister Narendra Modi’s home state of Gujarat, is emerging as a key gateway for international investors seeking access to India’s growth story, as well as for resident Indians looking for global wealth solutions, experts told CNBC.
Earlier this year, the government improved tax structures to bring GIFT City on par with global financial hubs such as Singapore, said Rajesh Gandhi, partner at Deloitte India. Those tax benefits are pulling in inbound investment, while the government has also loosened capital controls on outbound investments made through the city, Gandhi said, noting that his firm was seeing a rise in both outbound and inbound funds being set up in India’s first global financial center.
A pipeline of new funds
Last week, Standard Chartered announced plans to launch its Signature CIO funds from GIFT City. The British international banking group, which was among the first foreign banks to start operations there in 2020, will launch the funds “in the coming weeks,” Samir Subberwal, global head of wealth solutions, retail products, data and analytics at Standard Chartered, told CNBC. He described GIFT City as “one of the world’s fastest-growing international financial centres.”
BlackRock, through its joint venture with Mukesh Ambani’s Jio Financial Services, is also preparing to launch global ETFs out of GIFT City. Jio BlackRock Asset Management secured regulatory approval to launch funds there in May and plans to start two outbound funds — one global equity fund and another emerging markets fund — before the end of September, Rishi Kohli, the firm’s chief investment officer, told Moneycontrol, a Network18 outlet owned by Ambani’s Reliance Industries.
Government data shows fund management entities in GIFT City increased to 217 in May from 194 in November last year.
What’s driving the rush
A strong domestic investor appetite for global markets, relaxed rules for foreign currency usage, and increasing tax incentives are driving leading asset management companies to GIFT City, according to experts.
Global fund houses are waking up to pent-up demand from Indian investors for overseas markets such as the U.S., and GIFT City offers the most convenient route, the experts said.
India’s strict capital controls impose limits on how much asset managers can deploy overseas. The aggregate $7 billion ceiling on outbound investments has already been exhausted, experts pointed out. That has not stopped Indian equity funds from logging positive inflows for the 65th consecutive month, according to data from the Association of Mutual Funds in India, even as Indian markets have underperformed global peers.
Funds operating from GIFT City, however, are exempt from those outbound investment limits, allowing them to tap the growing pool of Indian investors.
Still a long way to go
Despite these tailwinds, experts caution that GIFT City has a long way to go before it can compete with established financial centers like Singapore, Delaware in the U.S., and Dubai International Financial Center (DIFC).
From a regulatory standpoint, GIFT City is on par with other global centers, but it needs to shed its image as an India-specific hub and emerge as a destination for global capital, the experts said. It also needs to match the lifestyle benefits of living in cities such as Dubai and Singapore.
Vivek Singhania, co-founder of Mumbai-based fund administration service provider Dovetail Capital, said GIFT City just needs “more time.” DIFC took 20 years to become the powerhouse it is today, he told CNBC. Regulatory structures at GIFT City were formed around 2020, and now things are gradually coming together, he said. His firm is in discussions with several U.S. and Singapore-based funds, as well as Indian funds, keen to set up operations in the city.
Vikas Satija, managing director and chief executive at Shriram Wealth, which scouts for funds operating out of GIFT City for high-net-worth clients, predicts that by 2030 GIFT City will become a key global financial center. The arrival of one of the largest global fund houses, BlackRock, is a “big sign,” he said.
Source: www.cnbc.com — https://www.cnbc.com/2026/08/13/global-funds-blackrock-modi-gift-city.html
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