India's maiden International Financial Services Centre (IFSC), offering globally competitive, dollar-denominated fund structures, tax neutrality, and frictionless cross-border capital deployment.
Connecting domestic and global investors to international financial markets under unified regulatory oversight.
Under the International Financial Services Centres Authority (IFSCA Fund Management Regulations), minimum ticket sizes depend on the scheme category. For Non-Retail Schemes (Alternative Investment Funds), the minimum investment requirement is typically USD 150,000 per investor. For Venture Capital (VC) schemes, it is USD 250,000 (with lower thresholds for accredited investors and employees/directors).
GIFT City is treated as a foreign territory for financial transactions while operating within Indian soil. It is regulated by the unified statutory body IFSCA, replacing multiple domestic regulators like RBI, SEBI, and IRDAI for IFSC operations.
All transactions, contributions, and distributions within GIFT City funds are typically denominated and settled in major foreign currencies (such as USD), eliminating constant currency conversion frictions for global investors and NRIs.
Operating through Fund Management Entities (FMEs) and specialized IFSC banking units.
Asset managers establish an FME within the GIFT City SEZ under IFSCA guidelines. FMEs can manage Retail Schemes, Non-Retail Schemes (AIF equivalents), Venture Capital Schemes, and Portfolio Management Services.
Funds can raise capital globally or domestically and invest seamlessly into Indian onshore assets, international markets, or hybrid portfolios without standard domestic FDI/ODI restrictions.
Investors can fund accounts and withdraw returns through specialized IFSC Banking Units (IBUs) in foreign currency or via NRE/NRO accounts with full repatriation freedom.
Flexible fund categories designed for diverse international and domestic investor mandates.
Open to both retail and institutional investors, offering diversified global portfolios, mutual fund structures, and Exchange Traded Funds (ETFs) like GIFT Nifty products.
Category I, II, and III equivalent private placement funds designed for accredited investors and high-net-worth individuals focusing on private equity, debt, and global hedge strategies.
Specialized light-touch regulatory frameworks allowing focused startup investments, co-investment options, and segregated portfolio structures for early-stage innovators.
Comparing GIFT City IFSC funds with onshore domestic Alternative Investment Funds.
| Parameter | GIFT City IFSC Fund Structures | Domestic Onshore AIFs |
|---|---|---|
| Currency & Repatriation | Denominated in foreign currencies (USD, etc.) with unlimited repatriation and no conversion friction. | Strictly denominated in Indian Rupees (INR) with complex FEMA outward remittance limits (e.g., LRS caps). |
| Tax Advantages | Extensive tax neutrality, 10-year tax holidays on business income for eligible entities, and capital gains exemptions for non-residents. | Subject to standard domestic tax rates, pass-through taxation rules, and capital gains tax slabs. |
| Transaction Levies | Zero Securities Transaction Tax (STT), zero Goods and Services Tax (GST) on fund management fees, and no stamp duty. | Subject to applicable GST on management fees, stamp duty on trust deeds, and transaction taxes. |
| Investment Mandate Scope | Global mandate allowing unhindered investments in India, overseas, or dual mixes without tight onshore caps. | Restricted overseas investment limits and heavy compliance burdens for cross-border asset allocations. |
| Regulatory Framework | Unified regulator (IFSCA) aligned with top global financial hubs like Singapore and Dubai. | Governed by SEBI and multiple domestic regulatory bodies under stricter domestic frameworks. |
Understanding market volatility, currency dynamics, and liquidity constraints.
Because these funds operate in foreign currencies (such as USD), investors face both underlying portfolio market volatility and currency fluctuation risks between INR and foreign denominations.
Many private and non-retail scheme structures have fixed lock-in periods and deployment cycles. Capital cannot be redeemed instantly, making them suitable for long-term sophisticated allocators.
Connect with our distribution team to evaluate cross-border fund options and tax-optimized global investment mandates.
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