Gujarat International Finance Tec-City (GIFT City) was conceived in 20071 to fashion a world-class financial hub in India. Many nations have established similar hubs to attract investments from across the world. These include the Qatar Financial Centre (QFC) and the Dubai International Financial Centre (DIFC), amongst others. As a developing economy with sizeable infrastructure financing requirements, foreign capital is important to India’s growth. Such capital will be even more important as India transitions towards becoming a sustainable economy.
Specifically, a Council on Energy, Environment and Water–Centre for Energy Finance (CEEW-CEF) study titled, ‘Investment Sizing India’s 2070 Net-Zero Target’ estimated that India would require investments of up to USD 10 trillion to achieve its 2070 net-zero target.2 The study further estimated that conventional sources would likely be able to mobilise only around two-thirds of the capital required, resulting in an investment gap of USD 3.5 trillion. Overseas funding can play an important role in mobilising capital for India’s net-zero target, including by helping bridge the investment gap,3 and GIFT City can be an effective means to help channel such capital.
GIFT City was established through a partnership between the Gujarat Urban Development Co. Ltd (GUDC) and the Infrastructure Leasing and Financial Services Ltd (IL&FS), with an initial investment outlay of INR 78,000 crore.4 It is a pre-eminent, futuristic city strategically positioned on the banks of Sabarmati River, 30 km from the Ahmedabad Airport. The city spans an extensive area of 886 acres, of which the special economic zone (SEZ) constitutes 261 acres.5 The SEZ is subdivided into two zones: the SEZ processing area (PA) and the SEZ non-processing area (NPA). The latter surrounds the former and provides support services to businesses operating in the PA.
There is an International Financial Services Centre (IFSC) in the SEZ PA.6 Financial activities in the IFSC at GIFT City are regulated by the International Financial Services Centres Authority (IFSCA), which is a unified regulator. As an IFSC, the objective of GIFT IFSC is “to provide, on Indian soil, such financial services currently consumed outside India by overseas financial institutions and overseas branches/subsidiaries of Indian financial institutions”.7 GIFT City is home to businesses which engage in a variety of financial activities, including banking, insurance, asset management, and capital markets.8 At the time of writing, the IFSC at GIFT City had licensed 22 banks, 22 broker-dealers, 3 exchanges, including an international bullion exchange, 4 insurance companies, and 17 insurance intermediaries, among other business categories.9
GIFT City was built to be urban and sustainable. It is the first Indian city to be awarded a Green Cities ‘Platinum’ certification from the Indian Green Building Council (IGBC).10 Multiple concerted efforts, such as integrated land use, urban development, and the creation of green and open spaces have facilitated this. The National Stock Exchange, in April 2022, announced the launch of an international sustainability platform at GIFT City – the International Sustainability Exchange Platform (ISX) – the first of its kind in India.11 It will list and trade a wide range of sustainability products, including green bonds, voluntary carbon, sustainability bonds, green real estate investment trusts (REITs), and green equities, among others.12 Such initiatives will encourage the long-term development and adoption of sustainability products within GIFT City.