Is GIFT City the New Dubai for Crypto and FinTech? A 2025 Guide to Setting Up an International Financial Entity

GIFT City — India's Emerging Financial Powerhouse

In 2025, Gujarat International Finance Tec-City (GIFT City) stands as India's first operational International Financial Services Centre (IFSC), positioned to rival global financial hubs like Dubai and Singapore. With over 1,000 registered entities and banking assets exceeding $100 billion, GIFT City is rapidly transforming into a magnet for global financial and tech enterprises.

What is GIFT City?

GIFT City is a greenfield smart city developed to serve as a global financial and technology hub. Located in Gandhinagar, Gujarat, it hosts India's first IFSC, offering a conducive environment for international financial services. The city integrates world-class infrastructure with sustainable urban planning, featuring commercial, residential, and recreational spaces.

GIFT City vs. Dubai and Singapore: A Comparative Analysis

While Dubai and Singapore have established themselves as leading financial centers, GIFT City is emerging as a formidable competitor. With its strategic location, favorable tax policies, and regulatory support, GIFT City offers an attractive proposition for global businesses. The city's infrastructure and connectivity further enhance its appeal.

Key Sectors Thriving in GIFT City

GIFT City supports a wide spectrum of sectors, making it a vibrant hub for global financial and tech businesses.

FinTech: Home to over 35 fintech companies, GIFT City fosters innovation in digital payments, blockchain, AI-driven financial solutions, and RegTech (regulatory technology). Startups and established firms leverage the city's regulatory sandbox to test products, from smart contract platforms to AI-based credit scoring systems.

Crypto & Digital Assets: GIFT City is emerging as India's regulated gateway for cryptocurrency and tokenized asset trading. The IFSC framework allows crypto exchanges and digital asset management firms to operate with clarity on compliance and taxation, attracting both Indian and international players.

Banking & Insurance: International banks such as Standard Chartered, Deutsche Bank, and Citibank have established IFSC Banking Units (IBUs) in GIFT City, offering corporate banking, treasury services, and cross-border financing. Insurance companies are also expanding, providing both life and general insurance products to domestic and global clients under the IFSC regulatory framework.

Funds & Asset Management: GIFT City has become a preferred location for Alternative Investment Funds (AIFs), mutual funds, and portfolio management services. Global fund managers benefit from tax incentives, simplified reporting, and the ability to access international capital markets seamlessly.

Capital Markets & Exchanges: India International Exchange (India INX), located in GIFT City, is the fastest operational exchange globally, handling trading across equities, bonds, and derivatives. It attracts foreign institutional investors (FIIs) looking for a hub with extended trading hours and multi-currency settlement.

Insurance & Reinsurance Services: The city provides a hub for international reinsurers and captive insurance companies, allowing them to manage risk and capital efficiently for global operations.

IT & Support Services: Beyond financial services, GIFT City houses IT/ITES firms offering software development, fintech product engineering, data analytics, and cloud services tailored to financial institutions.

Green Finance & ESG Investments: With sustainability-focused infrastructure, GIFT City is encouraging green finance initiatives, ESG-compliant funds, and carbon credit trading, positioning itself as a forward-looking financial hub.

Legal, Accounting & Advisory Services: Professional services firms including Big Four consultancies and international law firms operate in GIFT City, supporting financial entities with regulatory compliance, tax advisory, and corporate governance solutions.

Incentives and Benefits for Foreign Businesses

Foreign businesses can leverage several advantages:

• Tax Exemptions: 100% tax holiday for 10 consecutive years out of 15.
• Regulatory Support: Simplified compliance procedures under the International Financial Services Centres Authority (IFSCA).
• Infrastructure: State-of-the-art facilities, including Tier-IV data centers and smart city amenities.
• Global Connectivity: Access to international markets through exchanges like NSE International Exchange and India INX.

How to Set Up an Entity in GIFT City

Establishing a presence involves:

1. Entity Registration: Choose between setting up a branch, subsidiary, or liaison office.
2. Regulatory Approval: Obtain necessary licenses from IFSCA.
3. Infrastructure Setup: Lease or purchase office space within the designated zones.
4. Operational Compliance: Adhere to local laws and international standards.

Real-World Case Study: Air India's $215 Million Aircraft Financing

In 2025, Air India's leasing arm made headlines by securing a 215 million US dollar loan through GIFT City to finance six Boeing 777-300ER aircraft. This was one of the largest aviation financing deals executed through India's International Financial Services Centre (IFSC), highlighting GIFT City's capacity to handle complex, high-value international transactions.

The deal was structured via GIFT City's IFSC Banking Unit framework, allowing Air India to benefit from favorable tax incentives, streamlined regulatory approvals, and multi-currency transaction facilities. The loan was denominated in US dollars, and GIFT City's infrastructure enabled real-time cross-border settlement, reducing operational delays typically associated with overseas financing.

This transaction also marked a significant step in demonstrating India's ability to retain and attract large-scale financing deals domestically, instead of routing them through traditional offshore financial centers like Singapore or Dubai. It showcased GIFT City as a credible hub for international banking, corporate finance, and aircraft leasing operations, boosting investor confidence in India's regulatory and infrastructural capabilities.

Moreover, the deal involved collaboration with multiple global banks and financial advisory firms, including Standard Chartered and HSBC, which structured the financing and hedging components. The successful execution of this loan is now being cited as a benchmark for other Indian corporates seeking to leverage GIFT City for cross-border financing.

This case clearly underscores GIFT City's strategic importance for high-value, international corporate transactions, positioning it as not just a domestic financial hub but a globally competitive alternative to Dubai and Singapore for corporate financing, aircraft leasing, and other high-capital ventures.

NTPC's $750 Million Foreign Currency Loan

In another significant development, NTPC Ltd, India's largest power utility, secured a $750 million foreign currency loan from the IFSC Banking Units (IBUs) of Bank of Baroda and HDFC Bank, both located in GIFT City. This unsecured, syndicated External Commercial Borrowing (ECB) facility comprises a $500 million base amount and a $250 million greenshoe option, featuring a door-to-door tenor of 10 years and an average maturity of 7 years.

The successful execution of this loan highlights GIFT City's capacity to handle complex, high-value international transactions, attracting large-scale financing deals that were previously routed through traditional offshore financial centers.

Recent Updates and Policy Developments (2025)

• Real-Time Forex Settlement: RBI has initiated real-time foreign exchange transaction settlements in GIFT City, reducing settlement times from 24 hours to just 30 seconds.
• TechFin and Ancillary Services: IFSCA has introduced a framework for TechFin and ancillary services, streamlining operations for technology-driven financial entities.
• Mirror Firms for Chartered Accountants: ICAI has allowed Indian Chartered Accountants to establish mirror firms in GIFT City, enhancing professional opportunities.

Guide Section: Quick Start Toolkit for Entrepreneurs

To initiate operations in GIFT City:

• Research: Understand the regulatory landscape and sector-specific opportunities.
• Consult: Engage with legal and financial advisors familiar with GIFT City's framework.
• Plan: Develop a comprehensive business plan outlining objectives and compliance strategies.
• Apply: Submit applications for entity registration and necessary licenses.

Why GIFT City Matters: Strategic Advantages for Global Enterprises

GIFT City's strategic location, coupled with its robust infrastructure and investor-friendly policies, makes it an attractive destination for global enterprises seeking to establish or expand operations in India. The city's commitment to innovation and regulatory support further enhances its appeal as a financial hub.

Challenges and Future Outlook

While GIFT City presents numerous opportunities, challenges such as infrastructure development, talent acquisition, and global competition remain. However, ongoing policy reforms and strategic initiatives are expected to address these issues, paving the way for sustained growth and global recognition.

For NRIs & Businesses: Unlocking Tax Benefits and Investment Opportunities

GIFT City offers NRIs and foreign businesses access to a range of financial products, including fixed deposits, Alternative Investment Funds (AIFs), international stock exchanges, insurance products, and bonds. Gains from many of these products are exempt from taxation in India, reducing the burden of double taxation.

Key Components of GIFT City

• International Financial Services Centre (IFSC): The core financial hub offering a range of financial services.
• Multi-Services Special Economic Zone (SEZ): Hosts various sectors including IT/ITES, engineering, biotechnology, and pharmaceuticals.
• Domestic Tariff Area (DTA): Provides support services to businesses operating in the SEZ.
• Social and Civic Infrastructure: Includes schools, hospitals, and shopping centers to support residents.
• Transit-Oriented Development (TOD): Promotes sustainable transportation and connectivity within the city.

How to Invest Through GIFT City

• Direct Investment: Establish a branch or subsidiary within the IFSC.
• Financial Products: Invest in AIFs, bonds, and other financial instruments offered within the city.
• Partnerships: Collaborate with existing entities operating within GIFT City.

GIFT City — The Future of Global Finance

GIFT City is poised to become a leading global financial hub, offering unparalleled opportunities for businesses and investors. Its strategic location, investor-friendly policies, and commitment to innovation make it an ideal destination for those looking to establish a presence in India's burgeoning financial landscape.