GIFT IFSC Emerges as International Banking Hub

GIFT City International Financial Services Centre (IFSC) in Gujarat has expanded its banking activity through External Commercial Borrowings, FCNR(B) swap mobilisations, and international bond listings. The International Financial Services Centres Authority (IFSCA) recorded large-scale participation by domestic and foreign International Banking Units (IBUs) under the Reserve Bank of India’s special swap facility for Foreign Currency Non-Resident (Bank) deposits.

GIFT IFSC and International Banking Units

GIFT IFSC is India’s first operational International Financial Services Centre and functions under the International Financial Services Centres Authority Act, 2019. IBUs are branches of Indian and foreign banks set up in IFSCs to conduct offshore-style banking transactions in foreign currencies.

Under the RBI’s special swap facility, 20 IBUs sanctioned USD 54.02 billion for FCNR(B) deposits by 31 August 2026, and USD 52.82 billion was disbursed. The sanctioned amount had risen to USD 37.26 billion by 21 August 2026 from USD 28.60 billion on 14 August 2026.

External Commercial Borrowings and Bond Listings

External Commercial Borrowings are loans raised by eligible Indian entities from non-resident lenders, usually in foreign currency, under RBI and government regulations. Between April and August 2026, IBUs at GIFT-IFSC disbursed USD 11.62 billion in ECBs, with monthly disbursements increasing from USD 1.54 billion in April to USD 3.54 billion in August.

Indian banks also raised USD 11.12 billion through bond listings on GIFT-IFSC exchanges during April to August 2026. Of this, USD 9.17 billion was listed in July and August 2026.

Regulatory Framework and Financial Centre Functions

IFSCA is the unified regulator for financial products, financial services, and financial institutions in IFSCs in India. Its regulatory framework covers banking, capital markets, insurance, fund management, and aircraft leasing activities within GIFT IFSC.

FCNR(B) deposits are term deposits maintained by non-resident Indians in foreign currency, and they are governed by RBI rules on maturity, repatriation, and interest rates. Swap facilities are used by banks to manage foreign currency liquidity and to mobilise deposits in overseas-linked banking operations.

Important Facts for Exams

• GIFT City stands for Gujarat International Finance Tec-City.
• IFSCA was established under the International Financial Services Centres Authority Act, 2019.
• FCNR(B) deposits are maintained in foreign currency by non-resident Indians.
• External Commercial Borrowings are a source of foreign currency funding for eligible Indian borrowers.

GIFT IFSC is located in Gandhinagar district in Gujarat. It hosts banking, capital market, insurance, and fund management activities under a single international financial services framework.