AI Summary
GIFT City, a global business hub in Gujarat, India, serves as India's first International Financial Services Centre (IFSC). It offers state-of-the-art infrastructure and tailored regulations to boost business competitiveness. GIFT City is strategically important due to its location, cutting-edge technology, world-class facilities, and business-friendly regulatory framework, including SEZ status with fiscal incentives. Businesses can establish themselves as Private Limited Companies, LLPs, Branch Offices, Subsidiaries, or Foreign Company Representative Offices, each designed for specific needs. Eligible sectors include banking, insurance, capital markets, asset management, and fintech. Setting up involves securing office space, choosing a company structure, applying through the SWIT portal, and obtaining necessary approvals from the UAC and IFSCA. Tax benefits include income tax exemptions, no DDT, and GST exemptions. GIFT City offers strategic access to global markets, simplified compliance, and world-class infrastructure, making it ideal for global business expansion.
Last Updated on: 7th October 2025, 01:06 pm
Contents
- 1 Introduction to GIFT City: A Global Business Hub
- 2 GIFT City Special Economic Zone (SEZ) and International Financial Services Centre (IFSC)
- 3 Types of Legal Entities for Setting Up in GIFT City
- 4 Eligibility Criteria for Setting Up a Business in GIFT City
- 5 Step-by-Step Registration Process for Setting Up a Business in GIFT City
- 5.1 Step 1: Identifying Office Space
- 5.2 Step 2: Company Structure and Registration
- 5.3 Step 3: Submit Application via SWIT Portal
- 5.4 Step 4: Unit Approval and Regulatory Review
- 5.5 Step 5: Lease Agreement and Legal Formalities
- 5.6 Step 6: Compliance and Legal Undertakings
- 5.7 Step 7: Approval from IFSCA and Commencement of Operations
- 5.8 Step 8: Final Documentation and Records
- 6 Commencing Business Operations in GIFT City
- 7 Prominent Institutions Doing Business in GIFT City
- 8 Eligibility Criteria for Foreign Entities Setting Up in GIFT City
- 9 Detailed Breakdown of Membership Fees in GIFT City
- 10 Tax Benefits of Setting up Business in GIFT City
- 11 Benefits of Setting Up a Business in GIFT City
- 12 Conclusion
Introduction to GIFT City: A Global Business Hub
In the era of globalization, the need for a well-structured, business-friendly environment has never been more crucial. Positioned strategically in Gujarat, India, the Gujarat International Finance Tec-City (GIFT City) stands as a prime example of a global business hub. Since its inception in 2015, GIFT City has been developed to cater to the needs of both domestic and international businesses. This remarkable project serves as a gateway to opportunities in finance, technology, and global trade, offering an ideal environment for companies to set up operations and capitalize on India’s growing financial markets.
What is GIFT City?
GIFT City, formally known as Gujarat International Finance Tec-City, represents a monumental step towards creating a world-class financial and IT services hub in India. Designed as a “Smart City,” it provides state-of-the-art infrastructure and regulatory regimes tailored to boost the competitiveness and efficiency of businesses. As the first International Financial Services Centre (IFSC) in India, GIFT City is built to cater to global financial needs while offering attractive incentives for business setup.
GIFT City’s Strategic Importance for Businesses
The strategic location of GIFT City enhances its potential as a global business destination. Positioned to serve the growing demands of India’s financial services sector on a global scale, GIFT City offers a unique blend of cutting-edge technology, world-class facilities, and a business-friendly regulatory framework. Its multi-services Special Economic Zone (SEZ) status further bolsters its appeal by providing a range of fiscal incentives. These include tax exemptions and favorable regulations that make GIFT City an attractive hub for financial services, IT, and IT-enabled Services (ITeS) companies.
GIFT City’s Rising Global Significance
Ranked 46th among financial centers in Asia as per the 2025 Global Financial Centres Index, GIFT City has made remarkable strides in just a decade. It has leapfrogged Mumbai as the prime financial center in India, showcasing a rapid rise from its humble beginnings. The city gained 15 spots from the previous year, highlighting its growing influence in the global financial landscape. The 2020 report by the Global Financial Centres Index had already indicated GIFT City’s potential to become a major player in the coming years, and it is now on track to cement its position as one of the top emerging financial centers worldwide.
GIFT City Special Economic Zone (SEZ) and International Financial Services Centre (IFSC)
The Dual Structure of GIFT City: SEZ and DTA
The Gujarat International Finance Tec-City (GIFT City) operates as a premier International Financial Services Centre (IFSC) in India. Its operational area is strategically partitioned into two distinct zones: the Special Economic Zone (SEZ) and the Domestic Tariff Area (DTA). This bifurcation is crucial for understanding the differing regulatory and economic frameworks within the city. The SEZ component is specifically designed to function as an offshore financial hub, facilitating global transactions.
GIFT SEZ: A Hub for Export-Oriented Financial Activities
The GIFT SEZ is a dedicated, geographically demarcated area within GIFT City established with the core objective of promoting export-oriented economic activities, particularly within the finance, technology, and allied service sectors. This zone provides a world-class physical and regulatory infrastructure to attract international business operations.
Key Operational and Financial Advantages in the GIFT SEZ
- Global Client Focus and Foreign Currency Transactions: Entities operating within the GIFT SEZ are mandated to conduct business exclusively in foreign currencies. Their primary focus is catering to global clients and facilitating international financial transactions. This setup is strategically designed to attract financial flows and activities that are currently undertaken by international institutions outside of India, effectively onshoring them.
- Significant Tax and Regulatory Incentives: Businesses situated in the GIFT SEZ benefit from a package of substantial tax benefits and regulatory concessions. These incentives are a major draw for global financial institutions, making the SEZ a highly competitive location. The comprehensive ecosystem in GIFT City is specifically tailored to promote business activities and offer compelling incentives related to capital, taxation, and ease of doing business.
Types of Legal Entities for Setting Up in GIFT City
GIFT City offers various legal structures for businesses to establish their presence in India’s premier financial hub. These structures are designed to provide flexibility and align with global regulatory standards. Key options include:
- Private Limited Company: A popular choice for both domestic and foreign investors, offering limited liability protection and the ability to raise capital through equity. To set up a company in GIFT City, it must meet the minimum capital requirement and comply with Indian corporate laws.
- Limited Liability Partnership (LLP): Ideal for smaller businesses and partnerships, LLPs provide flexibility in management and offer limited liability protection, making it an attractive option for professional services firms and startups.
- Branch Office: Foreign companies can establish a branch office in GIFT City to conduct business in India. This allows them to leverage GIFT City’s regulatory advantages while maintaining a direct link to their parent entity.
- Subsidiary: A wholly owned subsidiary can be set up by foreign entities, providing them with full control over operations in India. This structure allows for compliance with local laws while maintaining corporate governance standards aligned with the parent company.
- Foreign Company Representative Office: For foreign entities wanting to establish a liaison in GIFT City without engaging in direct commercial operations, a representative office provides an option to handle marketing and customer support activities.
Each legal structure is designed to meet specific business needs and regulatory requirements, making GIFT City an ideal destination for businesses looking to expand their footprint in India’s financial services sector.
Eligibility Criteria for Setting Up a Business in GIFT City
Understanding who can set up a business in GIFT City and the specific compliance requirements is essential for domestic and international entities looking to establish operations in this jurisdiction. Here’s a detailed look at the eligibility criteria :
Types of Business Sectors Eligible to Start a Business in GIFT City
Banking
GIFT City facilitates the establishment of both Indian and foreign banks through IFSC Banking Units (IBUs). Some key areas under banking include:
- Indian and Foreign Banks
- Retail Banking for Non-Residents
- Treasury Operations & Structured Deposits
- Custodian and Escrow Services
- Transaction Banking (Cross-border)
- Wealth Management Platforms
Insurance
Both Indian and foreign insurers, as well as intermediaries, can set up their businesses in GIFT City. Key players include:
- Indian Insurers & Reinsurers
- Foreign Insurers & Reinsurers
- Insurance Intermediaries (e.g., brokers, agents, web aggregators)
- IFSC Insurance Offices for NRIs (covering life, health, ULIPs, travel, and student insurance)
Capital Market Entities
GIFT City is a hotspot for capital market-related activities, hosting a variety of entities such as:
- Stock and Commodity Exchanges
- Depositories and Custodians
- Brokers and Dealer-Brokers
- Clearing Corporations
- Registrar & Share Transfer Agents
- Credit Rating Agencies
- Market Infrastructure Institutions (MIIs)
Asset & Fund Management
Businesses involved in fund management and investment activities can benefit from GIFT City’s favorable infrastructure. Permitted entities include:
- Alternate Investment Funds (AIFs)
- Venture Capital Funds
- Private Equity & Structured Products
- Portfolio Management Services (PMS)
- Family Investment Funds / Family Offices
- Fund Management Entities (FMEs)
Leasing Services
GIFT City is an ideal location for businesses focused on leasing operations, such as:
- Aircraft Leasing and Financing
- Ship Leasing and Marine Finance
- Core Financing Companies
Payment Services & Fintech
Payment services and fintech businesses are also eligible to set up shop, with activities such as:
- E-money Issuance and Account Issuance Services
- Payment Aggregators & Gateways
- Cross-border Remittance Providers
- Escrow and Merchant Services
- FinTech Innovation Entities under Regulatory Sandbox
- International Trade Finance Services (ITFS)
Allied & Support Services
A variety of allied services can be established in GIFT City, such as:
- Global In-house Centres (GICs) and Treasury Centres
- Accounting, Audit & Legal Consultancy Services
- Compliance Advisory & Corporate Secretarial Firms
- HR & Talent Management Services
- Research & Development Services
- Educational & Capacity Building Institutions
- Specialized Trade & Investment Services
Sustainable Finance and ESG Initiatives
With a growing focus on sustainability, GIFT City is home to initiatives related to green and climate finance, including:
- ESG-labelled Debt Securities
- Sustainable Finance Products
- Sustainability-linked Loans and Bonds
Educational & Capacity Building
- Foreign Universities & Institutions (under IFSCA Edu Guidelines)
- FinTech and Compliance Training Centres
These businesses benefit from GIFT City’s modern infrastructure, regulatory incentives, and status as an SEZ, making it a strategic location for both financial services and global trade operations.
Criteria for International and Domestic Companies
Both international and domestic companies must meet specific criteria to operate in GIFT City, focusing on compliance, operational readiness, and financial stability.
- Regulatory Compliance:
- Companies must comply with the regulations set by the International Financial Services Centres Authority (IFSCA).
- Adherence to the Special Economic Zone (SEZ) rules and regulations is mandatory.
- Operational Compliance:
- Entities are required to maintain specific net worth, financial ratios and meet capital adequacy requirements as per IFSCA guidelines.
- Regular reporting and disclosure to IFSCA are required to ensure transparency and compliance with financial regulations.
- Financial and Operational Readiness:
- Entities must demonstrate the capacity for sustainable operations, which includes having a sound financial base and a robust business plan.
- Must have the organizational structure in place to commence operations immediately upon setup.
- Specific Compliances for Banking and Insurance Sectors:
- Banking units must adhere to norms related to exposure ceilings, reserve requirements, and prudential norms as specified by IFSCA.
- Insurance entities must comply with IFSCA guidelines, focusing on solvency margins and operational mandates.
Step-by-Step Registration Process for Setting Up a Business in GIFT City
Setting up a business in GIFT City (Gujarat International Finance Tec-City) offers several regulatory and infrastructural advantages, especially for businesses engaged in financial services, technology, and related sectors. The process for establishing a business in GIFT City is systematic and requires careful attention to legal, regulatory, and compliance-related steps.
Below is a detailed, step-by-step guide for GIFT City Registration and setup process:
Step 1: Identifying Office Space
Choosing an office space within GIFT City is one of the first crucial steps in the setup process. This space will serve as the operational base for your business and needs to comply with the GIFT City’s regulations.
How to Choose the Right Office Space:
- Evaluate factors such as proximity to transport links, the nature of your business, infrastructure compatibility, and possibilities for future expansion.
- GIFT City offers tailored zones designed to accommodate various business types, which can significantly improve logistical operations.
Legal Agreements with Developers:
- Upon identifying a suitable location, negotiate lease terms or purchase agreements with developers. Consider important legal clauses regarding lease duration, renewal terms, and any SEZ-specific provisions in your agreement.
Provisional Letter of Allotment (PLOA):
- Once terms are agreed upon, apply for a Provisional Letter of Allotment (PLOA) from the developer. This document serves as confirmation of the office space allocation and is necessary for progressing to subsequent steps.
Step 2: Company Structure and Registration
The next critical step is determining the legal entity structure of your business. GIFT City permits various business structures depending on the nature of services you intend to provide, such as:
- Private Limited Company
- Limited Liability Partnership (LLP)
This choice will dictate the required registration procedures and legal documents for your business.
Legal Documents to Prepare:
- Charter Documents: These include the Memorandum of Association (MOA) and Articles of Association (AOA), which define the company’s activities and shareholder rights.
- GST Registration, Income Tax Registration, Labor Laws Compliance: Depending on the business structure and scope of operations, other mandatory registrations may be required.
Step 3: Submit Application via SWIT Portal
GIFT City uses the SWIT (Single Window IT System) portal for streamlined submission of your application for both SEZ Unit Approval and IFSCA Authorization. This integrated approach eliminates the need for submitting separate applications to the SEZ Development Commissioner and IFSCA.
Required Documents:
- Provisional Letter of Allotment (PLOA)
- Detailed Business Plan or Project Report: This includes your financial projections, scope of activities, and other pertinent details.
- Certificate of Incorporation, PAN, MOA, AOA
- Board Resolution Authorizing Signatory
- Financial Statements (Audited)
- Identity and Address Proof of Promoters/Directors
- Application Fees
Application Covers:
- SEZ Unit Approval
- IFSCA Authorization (for regulated financial services)
Step 4: Unit Approval and Regulatory Review
After the application is submitted, your business will undergo a review by the Unit Approval Committee (UAC). Prepare to present your business model and operations plan, showcasing how it aligns with GIFT City’s goals for economic development.
Letter of Permission (LOA):
- If the UAC is satisfied with the application, the IFSCA (Administrator) will issue a Letter of Permission (LOA), granting formal authorization to commence operations.
Step 5: Lease Agreement and Legal Formalities
Once the LOA is issued, it’s time to complete the legal formalities to secure your operational status within GIFT City.
Key Formalities:
- Lease Deed Execution: Finalize the lease agreement with the co-developer, ensuring all terms are aligned with GIFT City’s regulations. This deed must be submitted to the Development Commissioner within six months of receiving the LOA.
- SEZ License & NSDL Portal Registration: Obtain the SEZ license, and register on the NSDL portal to facilitate import/export reporting and compliance.
Step 6: Compliance and Legal Undertakings
Ensuring compliance with all legal obligations is essential for a smooth setup process.
Bond Cum Legal Undertaking:
- Prepare and sign a Bond Cum Legal Undertaking with the Development Commissioner and the IFSCA to ensure compliance with the terms of operation.
Tax Exemption and Registration Certificates:
- Apply for various necessary registration certificates, such as GST, IEC, and RCMC. Additionally, businesses can apply for eligibility certificates to avail of tax exemptions from the central and state governments.
Step 7: Approval from IFSCA and Commencement of Operations
The final stage involves receiving approval from the International Financial Services Centres Authority (IFSCA) and officially commencing business operations.
Final Registration with IFSCA:
- Submit all required documents and application fees to IFSCA. Once reviewed, the Certificate of Registration will be issued, officially granting your business the status of an operating entity within GIFT City.
Commencement of Business Operations:
- Notify the Office of Development Commissioner of your business’s commencement. Provide evidence such as a tax invoice to confirm the first export of services, signaling the start of your operations within GIFT City.
Step 8: Final Documentation and Records
- Letter of Acceptance: After receiving the LOA, the business must provide a Letter of Acceptance, confirming agreement to the terms and conditions laid out by the authorities.
- Final Registration Certificates: Ensure that all necessary registrations, including GST, are completed, and the business is ready to operate under the regulatory framework of GIFT City.
By following these detailed steps, businesses can navigate the registration process in GIFT City with ease, ensuring compliance with all legal and regulatory requirements while benefiting from the advantageous tax and infrastructural benefits offered by the city.
Note: To begin the process of PSP registration, you must first apply for IFSCA (International Financial Services Centres Authority) registration. Once that is secured, the next step is to obtain the PLOA (Permission Letter of Approval), which is a key document in the regulatory framework. Following this, you will need to incorporate your entity as per the guidelines set by the relevant authorities. After the incorporation is complete, SEZ (Special Economic Zone) approval must be obtained to operate within the designated zone. These steps are then followed by similar processes for other regulatory approvals and compliances, ensuring that your entity is fully aligned with the legal and financial requirements for PSP registration in India.
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Commencing Business Operations in GIFT City
Steps to Commence Business After Registration:
- Operational Setup: Once your company is registered, the next step is to establish your office in GIFT City. This involves setting up the necessary infrastructure such as IT systems and office equipment to ensure your business operations can begin smoothly.
- Staffing: Recruiting a skilled workforce is essential. GIFT City offers access to a vast talent pool, thanks to its strategic location and emphasis on financial and tech industries. Ensuring that your team is well-versed in compliance and operational procedures specific to GIFT City will be crucial.
- Obtain GIFT SEZ ID Cards: File an application with the Customs office for issuance of ID Cards for your employees which is a mandatory requirement for entering the SEZ area.
- Final Compliance Checks: Before you start operating, it’s important to complete all compliance checks. This includes obtaining final approvals from GIFT City authorities and ensuring all legal and regulatory guidelines are met.
Mandatory Reporting and Operational Compliance:
- Regular Reporting: Businesses must adhere to strict reporting guidelines, which include submitting regular financial, operational, and compliance reports to both GIFT City authorities and the International Financial Services Centres Authority (IFSCA).
- Compliance with SEZ Regulations: Continuously monitor and comply with the regulations specific to Special Economic Zones (SEZs), which cover aspects like customs, tax, and labor laws.
- Environmental and Safety Standards: Maintaining high standards of safety and environmental compliance is crucial. GIFT City promotes sustainability and expects all businesses to adhere to these principles to ensure a safe and sustainable working environment.
Regulatory Framework for Financial Market Intermediaries in GIFT City
GIFT City operates under the International Financial Services Centres Authority (IFSCA), the primary regulator for financial services in India. The IFSCA’s framework ensures a transparent and efficient environment for financial market intermediaries, covering essential sectors such as banking, insurance, funds, and capital markets.
Key regulatory requirements include:
- Stockbrokers & Clearing Members: Must register with IFSCA and meet capital adequacy, operational, and KYC norms. They are required to maintain a minimum net worth and adhere to compliance guidelines for client due diligence and transaction reporting.
- Custodians: Must have a minimum net worth of $7 million for Indian entities and comply with financial segregation standards. Operational requirements include periodic audits and safeguards to ensure the protection of client assets.
- Fund Management Entities (FMEs): FMEs are required to register with IFSCA, with specific net worth requirements ranging from $75,000 for venture capital funds to $1 million for retail investment funds. These entities must comply with guidelines on investor eligibility, reporting standards, and operational transparency.
- Foreign Banks & Financial Entities: Foreign financial entities setting up in GIFT IFSC must ensure compliance with IFSCA regulations and their home country’s regulations. This includes meeting capital requirements, adopting anti-money laundering practices, and providing transparency in foreign exchange transactions.
The IFSCA’s unified framework reduces regulatory overlap, making GIFT IFSC an attractive destination for global financial market intermediaries, with a clear focus on compliance, investor protection, and operational efficiency.
Prominent Institutions Doing Business in GIFT City
GIFT City is home to numerous prominent global financial institutions and regulatory bodies, solidifying its position as India’s premier financial hub. Key players operating in GIFT include:
- International Banks: GIFT City hosts top global financial institutions such as MUFG Bank, BNP Paribas, HSBC, Citi Bank, and JP Morgan, offering a range of banking services, including corporate banking, trade finance, and foreign exchange transactions.
- Fund Management Entities (FMEs): Over 150 FMEs, including Private Equity, Venture Capital, and Hedge Funds, are registered in GIFT IFSC, contributing to India’s growing investment landscape. These entities manage substantial capital and offer unique opportunities for investors both domestically and internationally.
- Insurance Companies: Leading insurers such as ICICI Lombard and SBI Life Insurance are operating in GIFT City, offering both life and non-life insurance products tailored for global and Indian clients.
- Exchanges: GIFT City is home to two major exchanges, India INX and NSE IFSC, offering trading in equities, commodities, and currency derivatives. These exchanges have a growing monthly turnover of over $67 billion, fostering a robust capital market environment.
- Fintech Innovators: GIFT City also attracts fintech startups and established firms, providing them with a conducive environment for innovation in blockchain, AI, and other technologies that are transforming financial services.
These institutions leverage GIFT City’s strategic location, world-class infrastructure, and favorable regulatory environment to provide a competitive edge in the global financial market.
Sector-Specific Opportunities in GIFT City
Setting up a company in gift city offers unparalleled opportunities across various sectors, fostering an ecosystem that attracts global businesses. Key sectors benefiting from GIFT City’s favorable regulatory and tax frameworks include:
- Banking: GIFT City provides a robust platform for setting up IFSC Banking Units (IBUs), offering foreign currency transactions, trade finance, and capital raising. Banks benefit from a tax holiday of 10 years, exemption from CRR and SLR, and a lower MAT rate of 9%.
- Insurance & Reinsurance: Foreign and Indian insurers can set up in GIFT IFSC under flexible regulations. The city offers tax exemptions, including no GST on services, and relaxed capital requirements for insurance and reinsurance entities, positioning GIFT City as a growing hub for the insurance sector.
- Funds & Asset Management: With over 150 registered Fund Management Entities (FMEs), GIFT City serves as a prime destination for Private Equity, Venture Capital, and Hedge Funds. The sector enjoys favorable taxation, including capital gains exemptions and access to a growing base of accredited investors.
- Fintech: The fintech sector in GIFT City benefits from regulatory innovation, offering a conducive environment for blockchain, AI, and cryptocurrency ventures. The IFSCA’s framework provides flexibility in regulatory compliance, making GIFT City a hotspot for global fintech companies.
- Aircraft & Ship Leasing: GIFT IFSC enables the setup of leasing units for aircraft and ship leasing, with tax exemptions and an enabling framework for cross-border transactions, catering to global clients in aviation and maritime industries.
- Capital Markets: GIFT City is home to the India INX and NSE IFSC, offering trading in equities, commodities, and currency derivatives. The exchanges benefit from no Securities Transaction Tax (STT) or Commodity Transaction Tax (CTT), attracting global investors.
These sector-specific opportunities, backed by world-class infrastructure, a unified regulatory framework, and tax incentives, make GIFT City an ideal destination for setting up businesses or companies.
Eligibility Criteria for Foreign Entities Setting Up in GIFT City
Foreign investors looking to establish a presence in GIFT City must meet specific eligibility criteria set by the International Financial Services Centres Authority (IFSCA). These criteria ensure compliance with global standards while offering attractive opportunities for international businesses. Key requirements include:
- FATF-Compliant Jurisdiction: Foreign entities must be based in jurisdictions that are compliant with the Financial Action Task Force (FATF) standards, ensuring they meet global anti-money laundering and counter-terrorism financing regulations.
- Capital Requirements: Depending on the type of business, foreign entities must maintain certain minimum capital levels. For instance, banks must maintain a minimum capital of $20 million for an IFSC Banking Unit (IBU), while other sectors may have different capital needs.
- Operational Ring-Fencing: Foreign companies must ensure operational and financial separation between their GIFT City entity and their foreign parent company, providing clarity on cross-border operations and regulatory compliance.
- Regulatory Approval: Foreign entities must seek approval from the IFSCA before setting up operations. This includes submission of a detailed business plan, proof of compliance with financial and operational regulations, and adherence to local governance standards.
- Sector-Specific Eligibility: Certain sectors, like banking and insurance, have additional sector-specific requirements. For instance, foreign banks must be regulated by a recognized financial regulator in their home country and comply with the Reserve Bank of India’s guidelines on foreign exchange transactions.
Meeting these criteria ensures a smooth setup process for foreign entities, enabling them to leverage the advantages of GIFT City, including tax exemptions, regulatory flexibility, and access to India’s growing financial markets.
Maximizing Foreign Investments by Establishing a Business in GIFT City
India’s foreign investment landscape has seen significant growth, with FDI inflows reaching $81.04 billion in FY 2024–25, a 14% increase from the previous fiscal year. This growth is fueled by favorable investment routes such as Foreign Direct Investment (FDI) and Foreign Portfolio Investment (FPI). GIFT City, India’s International Financial Services Centre (IFSC), stands out as a prime destination for foreign investors due to its robust regulatory framework and attractive tax benefits.
GIFT City: A Key Hub for Foreign Investment
GIFT City offers streamlined financial services and tax incentives, including 10-year tax holidays for fund managers, making it an attractive option for global businesses. As of 2025, over 150 fund managers manage assets worth over $22 billion in GIFT City. Furthermore, the value of Offshore Derivative Instruments (ODIs) reached approximately $16.5 billion by May 2025, showcasing GIFT City’s growing role in international finance.
Detailed Breakdown of Membership Fees in GIFT City
GIFT City offers a transparent and structured fee system for businesses looking to establish themselves within its financial ecosystem. The membership fees vary depending on the type of entity and services provided, ensuring flexibility for different business needs. Key membership fees include:
- Stock Exchange Membership Fees:
- Trading Member: $500 application fee, with an annual fee ranging from $3,000 to $10,000, depending on the membership level.
- Clearing Member: $500 application fee, with annual fees starting at $3,000, plus additional deposits based on the type of membership.
- Clearing Corporation Membership Fees:
- Self-Clearing Member: $500 application fee, with annual fees ranging from $10,000 to $15,000, depending on the size of the operation and the clearing services offered.
- Professional Clearing Member: $500 application fee, with a refundable deposit requirement of up to $100,000 and an annual fee of $15,000.
- Exchange Fees for Specialized Activities:
- Investment Advisors & Other Intermediaries: Annual membership fees range between $1,000 to $3,500, with additional fees based on specific functions like portfolio management, investment advisory, and clearing activities.
These membership fees ensure access to GIFT City’s world-class trading infrastructure, regulatory benefits, and an integrated business environment, providing businesses with the tools needed to thrive in the global financial market.
Tax Benefits of Setting up Business in GIFT City
1. Income Tax Exemption
- Units in GIFT City’s IFSC are eligible for a 100% income tax exemption for 10 consecutive years within the first 15 years of operation.
- MAT/AMT of 9% applies to units that do not avail of the Section 80LA exemption, but companies opting for the new tax regime are exempt from MAT.
2. Dividend Distribution Tax (DDT) Exemption
- Companies in IFSC are exempt from Dividend Distribution Tax, with dividends paid to non-resident shareholders subject to a 10% withholding tax.
3. Capital Gains Tax Exemptions
- Capital gains from the transfer of specified securities, offshore derivatives, and non-deliverable forward contracts are exempt from tax for non resident.
4. GST and Customs Duty Exemptions
- No GST on services received by units in IFSC or provided to IFSC/SEZ units or offshore clients.
- Exemption from customs duties on goods imported into IFSC for authorized operations.
5. Stamp Duty and Securities Transaction Tax (STT) Exemption
- Transactions carried out on IFSC exchanges are exempt from Stamp Duty and STT, reducing the cost of trading.
Tax Benefits for Non-Resident Investors
1. Tax-Free Interest Income
- Interest income on fixed deposits and financial instruments in GIFT City’s IFSC is exempt from Indian taxation for non-residents.
2. AIFs Tax Exemptions
- Non-resident investors in Category I and II AIFs registered in IFSC are exempt from Indian tax on income from specified securities / overseas investments, and are not required to file tax returns in India.
3. Repatriation Benefits
- Income earned by non-resident investors from GIFT City investments is governed by India’s Double Taxation Avoidance Agreements (DTAAs), allowing for easy repatriation of earnings.
Sector-Specific Incentives
Financial Services
- Income tax exemptions and GST exemptions on services provided to offshore clients make GIFT City attractive for financial institutions.
Insurance and Reinsurance
- Tax exemptions on premiums received and claims paid, along with GST exemptions for services to offshore clients, enhance GIFT City’s appeal for the insurance and reinsurance sectors.
IT and TechFin
- IT and TechFin companies benefit from income tax exemptions, capital subsidies, and infrastructure discounts under the Gujarat IT/ITeS Policy.
Benefits of Setting Up a Business in GIFT City
- Strategic Location & Global Connectivity
GIFT City offers a prime location at the crossroads of global trade routes, providing businesses with seamless access to both Indian and international markets. Its strategic positioning ensures easy connectivity with key global financial hubs, making it an ideal choice for businesses looking to expand globally. The city is well-connected to major highways and the airport, ensuring that transportation and logistics are efficient, helping businesses tap into a wide range of market opportunities. - Benefits of Special Economic Zone
As a Special Economic Zone (SEZ), GIFT City offers numerous advantages for businesses, especially those looking to establish operations in India. The SEZ framework provides:- Tax exemptions and incentives: Units in the International Financial Services Centre (IFSC) can benefit from 100% tax exemption for 10 consecutive years out of 15.
- GST Waiver: No Goods and Service Tax (GST) on services received by IFSC units and a reduced Minimum Alternate Tax (MAT).
- Simplified compliance: GIFT City’s SEZ regulations are designed to foster ease of doing business, reducing bureaucratic hurdles and providing businesses with a simplified compliance framework.
- Access to global trade: GIFT City’s SEZ status enables businesses to benefit from streamlined export and import procedures, making it an ideal gateway to international markets.
- World-Class Infrastructure and Essential Services
GIFT City is designed to offer businesses a robust foundation with its world-class infrastructure. The city provides modern facilities and amenities that support both operational efficiency and business growth, including:- Power back-up and communication services: Ensuring uninterrupted business operations, GIFT City offers a reliable power supply and high-quality communication networks, vital for today’s tech-driven businesses.
- Solid waste management and district cooling systems: The city uses sustainable and eco-friendly technologies for waste management and energy-efficient cooling systems, providing a greener business environment.
- Mass rapid transit system: A well-developed transit network connects businesses and residents within the city, promoting mobility and easy access to commercial and residential areas.
- City command and control center: This smart management center ensures the efficient functioning of the city, handling everything from traffic to resource management, and supporting businesses with a seamless operational environment.
- The Tri-City Ecosystem: GIFT City, Gandhinagar, and Ahmedabad
GIFT City is part of a larger tri-city ecosystem, including Gandhinagar and Ahmedabad, enhancing its business appeal. This integrated approach offers businesses access to:- Enhanced resources and synergies: The surrounding cities contribute to a broader pool of talent, resources, and infrastructure that businesses in GIFT City can tap into.
- Collaborative business environment: The tri-city vision promotes a collaborative ecosystem where businesses can connect, innovate, and grow, strengthening the overall region’s competitive edge.
- Ideal Destination for Global Business Expansion
GIFT City is an excellent choice for international businesses looking to set up operations in India due to its:- Strategic access to global financial markets: GIFT City connects India’s financial markets with global trade, creating a thriving hub for international businesses.
- Liberal regulatory environment: The regulatory framework in GIFT City is more flexible than in other parts of India, making it easier for businesses to comply with local laws and operate without extensive bureaucracy.
- Competitive tax structure: With various tax exemptions and concessions, including tax holidays and reduced tax rates, GIFT City offers a cost-effective business environment, particularly for businesses in the financial services, IT, and high-tech industries.
- Shifting from Offshoring to Onshoring
The establishment of GIFT City marks a shift in India’s approach to global business operations. The government aims to encourage companies to move their operations from offshore locations to India, leveraging the city’s modern infrastructure and regulatory advantages. GIFT City provides the ideal environment for businesses to integrate with India’s economy, benefiting from global market connectivity while tapping into India’s growing market potential.
Benefits for Foreign Universities and Educational Institutes
Foreign universities and educational institutes operating in GIFT City can benefit from a relaxed regulatory framework, which exempts them from many of the domestic regulations that typically apply to Indian educational institutions. This provides greater freedom and flexibility to international academic entities, making GIFT City an attractive destination for establishing campuses and expanding educational services in India.
Conclusion
Adhering to the detailed guide for setting up and commencing operations in GIFT City is crucial for leveraging the full spectrum of benefits offered by this premier business hub. This guide ensures that businesses align with regulatory requirements and capitalize efficiently on the strategic advantages of GIFT City.
For more detailed information, visit GIFT City Business Operations and About GIFT City.
FAQs around Setting Up Business in GIFT City
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What is GIFT City and why is it attractive for businesses?
GIFT City, or Gujarat International Finance Tec-City, is a planned financial and IT hub in India. It offers businesses a world-class infrastructure, business-friendly regulations, and tax exemptions, making it an attractive location for companies in banking, finance, insurance, IT, and ITeS sectors.
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Who can set up a business in GIFT City?
Both international and domestic companies can set up businesses in GIFT City. They must comply with regulations set by IFSCA (International Financial Services Centres Authority) and meet specific criteria like having a sound financial base and a robust business plan.
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What are the steps involved in setting up a business in GIFT City?
The process involves securing office space, obtaining a Provisional Letter of Allotment (PLOA), submitting applications to IFSCA, obtaining approvals, completing legal formalities, registering with IFSCA, and finally commencing business operations.
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What are the benefits of setting up a business in GIFT City?
GIFT City offers several benefits, including a strategic location, advanced infrastructure, regulatory advantages (tax exemptions, ease of doing business), access to a skilled workforce, and global connectivity.
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What are the tax benefits of setting up a business in GIFT City?
Businesses in GIFT City can enjoy benefits like 100% tax exemption for 10 years, reduced Minimum Alternative Tax (MAT) / Alternate Minimum Tax (AMT), and exemption from Goods and Service Tax (GST) on services received.
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What are the regulatory requirements for operating in GIFT City?
Companies must comply with regulations set by IFSCA, including maintaining specific net worth and financial ratios, submitting regular reports, and adhering to Special Economic Zone (SEZ) rules.
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How can I find more information about setting up a business in GIFT City?
You can visit the Official GIFT City website for detailed information on business operations, regulations, and contact details.
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What type of businesses are allowed in GIFT City?
GIFT City caters primarily to the Banking, Financial Services and Insurance (BFSI) sector. This includes banking, investment banking, asset management, insurance, reinsurance, capital markets activities (trading, broking, clearing & settlement), FinTech, TechFin, Payment service providers, professional services (legal, accounting, consulting), and support services (HR, training).
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How to open a company in GIFT City?
Opening a company in GIFT City involves several steps:
- Identify your business type: Ensure your business activity falls under the permissible categories in GIFT City.
- Choose office space: Consider factors like location, infrastructure, and compliance with SEZ regulations.
- Obtain a Provisional Letter of Allotment (PLOA): Finalize lease agreements with the developer and secure the PLOA for your chosen space.
- Apply for IFSCA registration: Submit the required documents (Form FA) with IFSCA, including your business plan and financial details.
- Secure approvals: The Unit Approval Committee (UAC) will review your application. Upon approval, you’ll receive a Letter of Permission (LOA).
- Complete legal formalities: Finalize lease deeds, obtain SEZ licenses, register on the NSDL portal, and comply with legal undertakings.
- Register with IFSCA: Submit final documents and fees to obtain your Certificate of Registration, authorizing business operations.
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