Reshape GIFT City
The IFSC is no longer a concept; it is a force. In just a few years, GIFT City has transformed from an ambitious project into a globally competitive international financial services centre hub.
This rapid ascent—evidenced by the IFSCA Bulletin data showing over 133 financial support entities and growing TechFin activity as of late 2025 is driven by continuous regulatory refinement.
We analyze the five most impactful policy shifts—expected to be fully realized or announced in the 2026 fiscal year—that will fundamentally reshape the landscape for Banking, Capital Markets, Insurance, and Fund Management within the IFSC.
For any institution looking to capitalize on this wave of growth, engaging an International Financial Services Centre consultant is now paramount.
I. Deepening the Global Custody and Settlement Ecosystem
The primary change will be the introduction of a streamlined, globally benchmarked framework for cross-border settlement, custody, and netting.
This modernization will likely involve new reciprocal agreements with key international financial centers (IFCs) across the globe. The expected impact is substantial: it will dramatically reduce transaction costs and settlement risk for foreign portfolio investors (FPIs).
This move makes the IFSC a far more attractive proposition for large-scale global fund operations, back-office activities, and treasury management, directly boosting the flow of international capital.
II. Easing Access for Retail Investment into Foreign Securities
Policy adjustments are expected to liberalize rules governing the India International Bullion Exchange (IIBX) to include broader foreign security and asset access mechanisms for resident Indians.
While strictly adhering to Liberalized Remittance Scheme (LRS) limits, this expansion will move beyond the current focus on gold. The effect will be to position the IFSC as the official, streamlined gateway for retail Indian capital seeking global diversification.
This liberalization will significantly boost transaction volumes, generate fee income for Gift City Consultant firms, and deepen the overall financial ecosystem.
III. Introducing Specialized Sustainable Finance Vehicles
The IFSCA is set to unveil a mandatory, comprehensive “Green Taxonomy” for the IFSC. This will be paired with new, dedicated structures for Green Bonds and Sustainability-Linked Bonds (SLBs), complete with enhanced tax incentives or regulatory ease.
This policy is designed to aggressively attract ESG-focused global capital. By providing regulatory clarity and dedicated structures, GIFT City will solidify its position as a leading hub for green finance in Asia, effectively catering to climate-conscious investors and large-scale infrastructure projects across India.
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Expanded Permissible Activities for Banking Units (IBUs)
Policy 4 focuses on transforming IFSC Banking Units (IBUs) by expanding their non-fund based permissible activities. This includes further liberalization of derivatives trading, complex hedging structures, and cross-currency swap products.
The impact is a profound shift: IBUs will transition from simple loan providers to full-spectrum investment banking partners. This enhanced capacity allows them to manage large, international corporate treasury operations and sophisticated risk management needs, making them critical allies for global businesses operating in or with India.
V. Regulatory Sandbox 3.0: Focus on AI and Distributed Ledger Technology (DLT)
The launch of the third-generation Regulatory Sandbox will explicitly prioritize FinTech solutions utilizing Artificial Intelligence (AI) for compliance and risk management, alongside large-scale Distributed Ledger Technology (DLT) applications for trade finance.
This move is designed to fast-track the adoption of cutting-edge technology. It will cement GIFT City’s reputation as a ‘Lab for Global Finance’, successfully attracting high-skill TechFin companies and creating a vibrant, future-proof financial ecosystem.
Integration Note: The data on 133 financial support entities, 23 TechFin entities, and 3 GICs from the “IFSCA BULLETIN JUL-SEP 2025 .pdf” should be visually presented here to validate the “rapid growth” thesis.
III. Conclusion and Forward View
These five policies collectively create a synergistic effect—attracting foreign capital, deepening domestic participation, fostering innovation, and enhancing regulatory robustness.
When taken together, these measures serve as a clear magnet for foreign direct investment in india. The year 2026 will undoubtedly be a watershed moment, shifting the focus from ‘establishing’ the hub to effectively ‘scaling’ it globally.
To efficiently navigate this evolving regulatory landscape, institutions must seek guidance. A knowledgeable GiftCityAdvisor or Gift City Advisor is essential to convert policy opportunities into strategic business advantages and secure a leading position in India’s financial gateway to the world.
Review your strategic plans now to capitalize on these impending changes.