Single window for IFSC development
The location of IFSC Authority headquarters in Gandhinagar will accelerate the development of GIFT City, said Tapan Ray, MD & Group CEO, GIFT City.
“We welcome Government of India’s decision to set up the IFSC Authority headquarters at Gandhinagar Gujarat. This will provide a single window regulatory institution which would accelerate the development of India’s first IFSC at GIFT City, Gandhinagar,” he said.
Both national and international institutions dealing with international financial services would utilize the IFSC platform for inbound and outbound investments with improved ease of doing business, thereby making GIFT IFSC a global financial hub, believes Ray.
The government gazette, dated 27 April, has declared, for the first time, Gandhinagar as the new headquarters for the IFSC Authority instead of Mumbai.
For countries where currency is not fully convertible, IFSC generally provides for unified regulatory authority (authority that supervise two or more of these areas).
The fact that number of countries are now moving towards integrating the different supervisory functions into a single regulator, and that different types of financial services and products continue to spring up in the financial sector of many countries, are indications of the changing global landscape of the financial services industry.
The concept of Unified Financial Regulator is simple but powerful.
What it means for IFSC in India is the undivided attention it provides towards the development of IFSC in India.
One of the most important roles a Unified Regulator plays is the creation of enabling framework benchmarked globally. It is not worried about domestic rules and regulations but tries to create a level playing field for the IFSC to compete globally.
In a short span of four years after the announcement of competitive tax regime in the union budget 2016, the business transactions at GIFT IFSC has shown multiple jump, it is learned that the banks operating in GIFT IFSC has already carried out US$26 billion transactions, the insurance business has reported Sum insured of US$30 billion and the Capital Market is witnessing average daily transactions of around US$4 billion.
The export of financial services from GIFT SEZ IFSC crossed Rs.4,300 crore compared to Rs.1,600 crore two years back.
In order to take the IFSC to next level with major participation from resident and non-residents and for multi fold jump in transactions, Unified Regulator would play a key role. Considering the Unified Regulator for IFSC was the demand of the existing regulators, it would get the required support to prepare the regulatory framework which could be better than prevailing globally.
While it was important to start the IFSC in India to serve the increase demand for International Financial Services, a regulatory framework backed by institutional arrangement to regulate the international financial centre is a big step forward in making India a hub for international financial services transactions. fiinews.com
