IFSC Banking Units

Subscribe to IFSC Banking Units via RSS

IFSC Banking Units – offshore branches with onshore dispute resolution

The Gujarat International Financial Tec-City (“GIFT”) in Gandhinagar, Gujarat, is India’s first operational greenfield smart city, housing a domestic tariff zone and an International Financial Services Centre (“IFSC”) in a Multi-service Special Economic Zone (“SEZ”). As part of developing India’s very own and first IFSC, both Indian and foreign banks are permitted to establish and operate IFSC Banking Units (“IBU”) from GIFT IFSC, upon obtaining the requisite licenses and permissions. The IBUs have the advantage or the ability to transact in freely convertible foreign currencies in the offshore markets, while being situated within the territorial borders of India. From 2015 to early 2020, the Reserve bank of India issued notifications and regulations related to the IFSC framework. Thereafter, on April 27, 2020, the International Financial Services Centres Authority Act, 2020, was notified, pursuant to which the International Financial Services Centres Authority (“IFSCA”) was established on October 1, 2020, as the unified regulator with wide powers to develop and regulate financial products, financial services, and financial institutions in IFSCs, including IBUs.Continue Reading IFSC Banking Units – offshore branches with onshore dispute resolution?

Aircraft Leasing in IFSC

The Government of India (“GOI”) has, in the recent years, realised the importance of aircraft leasing activities in the global market and has made its intentions clear to promote aircraft leasing and financing activities in India’s first International Financial Services Centre (“IFSC”) situated in GIFT City, Gandhinagar. The aim is to bring the aircraft leasing business,  currently being carried out in countries that have established themselves in this sector such as Ireland, USA, Hong Kong, Singapore, etc[1], to the Indian shores. Leasing aircraft from abroad leads to incurring substantial liabilities payable in foreign currencies. Hedging currency fluctuations also becomes an additional cost for Indian airline operating companies. The above reasons highlight cost-inefficiencies and put into perspective how crucial it is to begin aircraft leasing and financing activities in India.Continue Reading Part III (A): Aircraft Leasing in IFSC – Let’s kick the tires and light the fires!