A GIFT City institute, set up in partnership with
February 09, 2026 / President's Desk
In late 2025, a familiar conversation played out in a very modern boardroom. A large Indian NBFC needed to refinance a maturing dollar facility. The treasury team had done this many times before, and the playbook usually ended in the same places: Singapore, Luxembourg, sometimes Dubai—jurisdictions where global investors were comfortable, documentation was standardized, and cross-border execution felt frictionless. This time, however, the memo on the table included a new option: raise and list from GIFT IFSC. The proposal was not framed as a nationalistic gesture. It was framed as a cold, operational question: could an India-based jurisdiction now deliver offshore-grade certainty, speed, and market access?
That question sits at the heart of why GIFT City could be a game-changing paradigm for Indian finance. The real promise of GIFT is not its skyline; it is the strategic attempt to “onshore offshore finance.” For decades, India has attracted global capital because the underlying exposure is compelling—growth, credit demand, infrastructure needs, and a deepening consumer economy. Yet the jurisdictional layer of finance has often sat outside India. A meaningful portion of India-linked cross-border activity—fund domiciliation, structured vehicles, certain listings, specialist treasury routes, and segments of derivatives—has historically been intermediated through global financial centers. The result is a persistent leakage of ecosystem benefits: high-value fee pools, risk management expertise, sophisticated legal and structuring capability, and market-making talent compound outside the country even when the underlying economic risk is Indian. GIFT IFSC is designed to reverse that pattern by creating an international financial jurisdiction within India that global institutions can recognize and use.
The first paradigm shift is governance. Modern finance does not fit neatly into traditional regulatory silos. A single transaction can touch banking, securities markets, asset management, and payments rails simultaneously. In India’s domestic system, these domains typically map to different regulators, which can slow product innovation and create friction when rules need harmonization. In the IFSC, the International Financial Services Centres Authority (IFSCA) was built as a unified regulator for financial products, services, and institutions operating in the jurisdiction. That institutional design matters because global financial centers compete as much on regulatory coherence and speed as they do on incentives. A unified regulatory interface can reduce duplication, shorten time-to-market for new products, and create a more predictable supervisory environment—conditions that matter enormously to global banks, asset managers, and sophisticated market participants.
The second paradigm shift is credibility through proof-of-work. Financial hubs do not become real through announcements; they become real through repeat transactions. Here, GIFT’s progress is increasingly measurable. Debt listing, often the first scalable market in an emerging hub, has shown momentum. IFSCA’s “Debt Market at IFSC: Landscape & Trends” report notes that in FY 2024–25 there were 57 debt issuances listed in the IFSC, raising approximately USD 6.99 billion. For a global investor, these numbers are not yet comparable to mature offshore centers, but they do signal that the mechanics—issuer interest, listing capability, investor participation, and regulatory handling—are functioning well enough to attract activity across multiple sectors. In capital markets, that is the first step toward compounding: one successful issue becomes a reference point, which lowers friction for the next.
Derivatives offer a tougher test because liquidity cannot be legislated; it must be nurtured until it becomes self-sustaining. Here too, GIFT has attempted to seed a flywheel. NSE International Exchange (NSE IX) has reported record monthly turnover figures in 2025 and has highlighted the gradual expansion of access and participation. Reuters reporting has also underlined a defining feature of the IFSC approach: rules and product design can diverge from mainland constraints to target sophisticated international participants, even while domestic Indian residents remain restricted from trading certain contracts. The strategic logic is clear. If GIFT can become a default venue for India-linked hedging and exposure in a structure that is legible to global market participants, it pulls an entire category of “offshore by habit” activity into an India-based jurisdiction.
The third paradigm shift lies in financial plumbing—settlement and payments infrastructure that quietly determines whether markets can scale. In October 2025, IFSCA announced the launch of a Foreign Currency Settlement System (FCSS), described as a payment system authorized under the Payment and Settlement Systems Act to enable settlement of foreign currency transactions between IFSC Banking Units. This is not merely back-office modernization. Settlement capability affects operational risk, transaction speed, and the breadth of products that can be supported. Hubs that control clearing and settlement become sticky because they make the full lifecycle—issuance proceeds, hedging flows, cash management, and custody—more seamless.
A final reason GIFT could rewire Indian finance is ecosystem density. A Press Information Bureau note dated November 28, 2025, cited 1,034+ registered entities in GIFT IFSC, including 38 banks with an asset base of $100.14 billion, alongside continued policy incentives such as a 10-year income tax exemption within a 15-year block for eligible units. Institutional density matters because network effects are the oxygen of financial centers: more participants create more flows, which create liquidity and product depth, which attracts more participants. When this loop becomes durable, the center stops needing persuasion; it becomes default.
None of this is inevitable. GIFT’s long-term success will depend on sustained policy stability, credible enforcement and dispute resolution, and the hard work of maintaining market integrity as volumes grow. Liquidity must persist through volatility cycles, not only during incentive-driven spurts. Yet the direction of change is visible. If GIFT continues to convert registrations into real transaction volume, expands settlement adoption into routine treasury behavior, and keeps regulatory clarity consistent, it will not simply add another venue to India’s financial landscape. It will change the architecture of Indian finance by onshoring activities that were offshore by default—bringing capital, capability, and innovation back home under an international rulebook.
