Launch of more products, retail participation to scale up GIFT IFSC: Tapan Ray

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NEW DELHI: A bigger basket of financial service products and retail participation will help in making GIFT IFSC attractive for international players, GIFT City managing director Tapan Ray has said. Launch of more products and participation from retail investors will shore up volume and liquidity at the country’s only International Financial Services Centre (IFSC) in GIFT City, he said.

At present, only derivative products are available for trading and retail investors are not allowed to participate.

Recently, markets regulator Sebi allowed investment advisory services in IFSC and permitted emerging investment vehicles REITs (real estate investment trusts) and InvITs (infrastructure investment trusts) to list on stock exchanges operating in IFSC.

“We need to open up more products, participants and provide a level-playing field, which is at par with other global IFSCs so that international player will get attracted,” Ray told over phone.

According to him, retail can bring in huge numbers — volumes and participants, that would bring down the cost for banks, insurance and other entities working here.

In addition, Ray said GIFT City is targeting to reach 30,000 jobs in next three years from the current level of 10,000.

IFSC, which caters to customers outside the jurisdiction of the domestic economy, deals with flows of finance, financial products and services across borders.

GIFT-IFSC, which became operational in April 2015, houses 14 banks, 19 insurance firms and about 100 capital market entities. In addition, there are two international exchanges operational from this zone and runs 22 hours a day.

With regard to international bullion exchange, Ray said the modalities for the products as well as structure for the bourse are currently underway.

The setting-up of the international bullion exchange would lead to better and transparent price discovery of gold, enhance the country’s position in the bullion market worldwide and help in creation of jobs, he said.

“We are working with all the stakeholders — retailers, wholesalers and entire value chain — and authority is hoping that first transaction on the bourse will take place in 6-8 months,” he added.

Ray also said that discussions for joining hands with experienced foreign players as partners are also going on for the bourse.

Also, the government has recently notified bullion as a financial product in the IFSC, which would help in attracting more players.

Last week, an expert committee, constituted by the newly created International Financial Services Centres Authority (IFSCA), said the IFSC can aim to become the gateway to India growth story for international investors and business.

In its interim report, the committee said the IFSC should look at providing Indian diaspora and individuals from Asia and Africa with a comprehensive range of financial services.

It also said the IFSC should serve domestic residents availing liberalised remittance scheme.

The committee was set up last month to suggest ways to develop international retail participation in the IFSC.

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