GIFT city emerging India’s first greenfield smart city
It’s operational with more than 200 entities which have set up their offices
Around seven km from Gujarat’s capital Gandhinagar, on the banks of the Sabarmati river in approximately 886 acres, once a barren land along the river is now emerging as the country’s first greenfield integrated city — a dream project Prime Minister Narendra Modi had envisaged as Chief Minister.
Now operational with more than 200 entities which have set up their offices where more than 12,000 people are working, the Gujarat International Finance Tec City (GIFT City) is India’s first and only International Financial Services Centre (IFSC) where banks, stock exchanges and financial services firms have set up their global operations.
As per the plans, 886 acres will be provided to develop nearly 62 million square feet built-up area constituting 67% commercial, 22% residential and 11% social space.
Further, the entire city project has been divided into a multi-service Special Economic Zone (SEZ) spread over 261 acres and exclusive domestic tariff area (DTA) spread over 625 acres.
“Thanks to the Central Government’s proactive support to develop the country as a hub of international financial services, the GIFT City has emerged as the preferred location for national and multinational firms,” said Tapan Ray, CEO and MD of the GIFT City and former Secretary, Corporate Affairs in the Government of India.
The Centre has announced a range of tax exemptions for entities to start their international operations from the GIFT City. As a result, both the BSE and the NSE have set up their international stock exchanges, 17 banks including 12 domestic banks and five international banks issued licence to operate, 100 plus broking services, depository clearing operations and over 19 companies have begun operations for non-life reinsurance business.
The Centre’s IFSC-related relief measures include tax holiday for capital gains for aircraft leasing companies, tax exemption for aircraft lease rentals paid to foreign lessors, tax incentive for re-locating foreign funds in IFSC and exemption to investment divisions of foreign banks.
Since it’s a hub of international financial services, the Singapore Arbitration Centre has also been set up for dispute resolution while the International Bullion Exchange will likely become functional soon.
In his vision for the ambitious project, PM Modi had said while inaugurating the international stock exchange, “in 10 years from now, GIFT city should become the price setter for at least a few of the largest traded instruments in the world, whether in commodities, currencies, equities, interest rates or any other financial instrument.”
As more and more companies are joining to set up their businesses and operations in the rapidly developing city, the latest Global Financial Centers Index, London, dated September 2020 has placed the IFSC at GIFT City right at the top among 15 centres globally, which are likely to gain greater significance in the next 24 months.
According to Mr. Ray, the idea behind the IFSC is to bring back the financial services and transactions which are carried out in offshore financial centres by Indian corporate entities and overseas branches and subsidiaries of financial institutions to India by offering world class infrastructure and globally benchmarked regulatory environment.
The city is now buzzing with business activities as more and more skyscrapers are coming up. Mumbai’s Hiranandani has set up a tower, Bengaluru’s Sobha group is building residential apartments, another Bengaluru-based Brigade group has set up a five-star hotel and a 14-storeyed business tower, Mumbai’s Narsee Monjee Educational Trust has set up a Jamnabai Narsee School while a hospital is coming up.
As the developer of the project, the Gujarat Government has already developed key infrastructure amenities including water treatment and cooling plants, underground utility tunnel, automated waste collection and segregated plant and a metro train line is being built to connect it with Gandhinagar and Ahmedabad.