GIFT City - an acronym for Gujarat International Finance Tec-City has quickly become a prime location for global investment, financial services, and real estate development within India. The strategically located City lies between Ahmedabad & Gandhinagar; therefore, it will drastically change how both foreign and domestic investors perceive Investment at GIFT City.
Increasingly more investors are looking further than traditional marketplaces; therefore, there is a fantastic opportunity for Investment at GIFT City due to its futuristic infrastructure, tax benefits, and outstanding long-term potential.
Below, we answer the five key questions every investor should consider.
1. What exactly is GIFT City, and why is it significant?
GIFT City is India’s first operational smart city and International Financial Services Centre (IFSC), which has been designed specifically to enable global financial transactions in foreign currency. The City functions under a SEZ (Special Economic Zone) and is regulated by the IFSCA (International Financial Services Centres Authority), thus ensuring that it is a very business-friendly and world-class financial services & investment market.
GIFT City properties have been designed very differently from traditional properties in Indian cities because of their unique blend of both modern urban planning (i.e., high-density living) combined with reliable infrastructure (i.e., reliable communication networks, stable energy supply, etc.), leading multinationals and global investors to view it as a highly attractive destination for their operations.
2. What investment opportunities does GIFT City offer?
Investors can participate in a variety of asset classes within GIFT City:
Financial Instruments (i.e., stocks, ETFs, bonds, and derivatives) denominated in foreign currencies for trading on the IFSC securities exchanges.
The ability to obtain commercial / office space designed for companies doing business around the globe. Explore - Top Corporate Companies in Gift City.
Projects with mixed-use space (including both residential and commercial) built to complement a growing number of professional workers in GIFT City.
The growing corporate demand for property within the IFSC district, along with the significant potential for long-term capital returns and rental yield from an investment in GIFT City property, makes putting money into GIFT City property an increasingly good investment.
3. What are the benefits of investing in GIFT City?
There are numerous advantages to investing in GIFT City:
a. Regulatory & Tax Incentives
GIFT City is classified as an IFSC (International Financial Services Centre) and an SEZ (Special Economic Zone), and, therefore, is eligible for a large number of tax incentives, such as no taxes on sale or exchange of IFSC securities, no transaction taxes on commodities or foreign currency futures contracts in IFSC, and no stamp duty on IFSC property transfers.
b. Global Connectivity
Located close to Ahmedabad’s international airport, GIFT City is connected to key highways and is also soon to be linked via metro rail, providing access to the rest of India and internationally.
c. World-Class Infrastructure
The development of GIFT City has been designed with an emphasis placed on modern infrastructure, including utilities, smart city planning, direct fibre-optic connections, and IT-friendly environments, which together attract many of the fastest-growing business and service sectors, which, in turn, will drive up demand for commercial and residential properties in GIFT City.
The benefits associated with investing in GIFT City make GIFT City investment more than just purchasing real estate; GIFT City investment links the purchaser to the broader and greater economic change currently taking place.
4. Are there any risks associated with GIFT City investments?
As with all types of Investments, investing in GIFT City involves certain considerations:
Market Maturity – Though the Indian Financial System Code continues to gain traction, IFSC volumes continue to be much lower than similar markets across the world.
Liquidity Constraints – Due to the recent development of IFSCs, there are very few potential exits for early-stage investment partners.
Regulatory Complexities – Investments in an IFSC often include a requirement to provide financing in a foreign currency and comply with many different regulations.
However, many investors view these as manageable in exchange for the long-term growth potential tied to India’s global financial aspirations.
5. What’s the future outlook for Gift City investments?
Currently, there are multiple global partnership firms working with and building in GIFT City, displaying significant commercial confidence and future investment potential.
As the ecosystem continues to develop (due in part to stronger regulations and an increase in corporate demand), valuing both commercial and residential properties will likely continue, making GIFT City not only a financial trading center but also a strong place for multi-faceted portfolios of GIFT City Investments.
If you have additional questions or would like assistance with investment opportunities in GIFT City, please contact an experienced professional.
FAQ
1. Can Indian residents invest in GIFT City?
Yes, investors from India are permitted to invest up to USD 250,000 per year through the Liberalised Remittance Scheme in any instrument listed on an IFSC.
2. Are there tax benefits for residential property investors?
Tax incentives exist generally for financial and corporate transactions conducted via the IFSC, but may extend indirectly to real estate development and leasing due to increased spending and inflow of capital.
3. How do Gift City properties compare with other Indian cities?
With state-of-the-art planning and infrastructure, many properties in GIFT City produce significant yields or growth possibilities compared to traditional property markets.
4. Is GIFT City only for financial investors?
No, while the financial services segment acts as the backbone of the ecosystem, commercial properties, office buildings, and resident investors also represent large portions of this ecosystem.
5. Where can I get more information on current listings?
For curated property listings and expert insights, visit RES Management.
