{"id":9126,"date":"2023-05-16T10:24:06","date_gmt":"2023-05-16T10:24:06","guid":{"rendered":"https:\/\/iqeq.com\/?p=9126"},"modified":"2023-06-13T07:51:48","modified_gmt":"2023-06-13T07:51:48","slug":"the-future-of-finance-in-india","status":"publish","type":"post","link":"https:\/\/iqeq.com\/insights\/the-future-of-finance-in-india\/","title":{"rendered":"The future of finance in India"},"content":{"rendered":"
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India\u2019s rise on the world stage has been impressive. According to the International Monetary Fund<\/a>, India\u2019s economy is now the fifth largest in the world after a forecasted growth of 7% last year. It\u2019s also predicted<\/a> that by 2027, India will surpass both Japan and Germany to become the third largest economy in the world, and by 2030 will have the fifth largest stock market with a market capitalization of about $10 trillion.<\/strong><\/p>\n

When we discuss the future of finance in India, a must-mention from an investor perspective is the Gujarat International Finance Tec-City (GIFT City), in Gujarat State. It is built on the banks of the Sabarmati river and home to India\u2019s global bullion exchange and its maiden International Financial Services Centre (IFSC).<\/p>\n

In this article, we\u2019ll take a look at what makes GIFT City unique, and why India could be a top jurisdiction for fund managers and investors.<\/p>\n

What is GIFT City?<\/h2>\n

Located between the business capital, Ahmedabad, and the political capital, Gandhinagar, GIFT City is India\u2019s first smart city, sponsored by the Indian government. It\u2019s dubbed as the \u2018FinTech gateway of India to the world\u2019 on the official website<\/a>, and it certainly has the credentials to back the claim. First conceptualised in 2008 by Prime Minister Narendra Modi, then the Chief Minister of the State of Gujarat, GIFT City offers a range of enticing tax incentives and state subsidies.<\/p>\n

According to the Union Government, the city has the potential to create 500,000 new jobs and another 500,000 indirectly as the growing financial industry will be boosted by new companies attracted to the development.<\/p>\n

A special economic zone<\/h2>\n

GIFT City\u2019s IFSC was declared a special economic zone (SEZ) in 2015 to position the smart city as India\u2019s main financial hub.<\/p>\n

With the Indian economy reaching the $3 trillion<\/a> mark by end-March 2023, the IFSC hopes to address the lack of convertibility of the Indian Rupee. The GIFT City is exempted from most of India\u2019s stringent currency regulations thus encouraging onshore trading of Indian assets which are currently done offshore through derivative financial instruments. This is also expected to significantly offset the effect of offshore trades on the rupee exchange rate.<\/p>\n

GIFT City being an SEZ, it caters to a slew of tax and other incentives to attract foreign and domestic investments. These include<\/a>:<\/p>\n