IFSCA Committee Submits Interim Report on Development of International Retail Business

The International Financial Services Centres Authority (IFSCA) Expert Committee on international retail business development in the IFSC has submitted its interim report to the Chairperson of the IFSCA on 21 September 2020. The interim report covers a number of suggestions aimed at swift and efficient development of international retail businesses in the IFSC, and focuses mainly on the banking vertical. Other key business verticals, i.e., insurance, asset management, and capital markets, will be covered in reports that the committee plans to release subsequently.

The Expert Committee has been constituted by the IFSCA with an aim to suggest how to develop international retail business in International Financial Services Centre (IFSC) along with potential strategies for making IFSC attractive for international financial services; provide a roadmap for future growth of international retail business in IFSC; and also examine and recommend any other issues that are important in the development of the IFSC.

Speaking of the vision for GIFT IFSC, Injeti Srinivas, Chairperson, IFSCA, said, “Our focus is to provide a best in class jurisdiction with progressive and light touch regulation to create an attractive location for international financial services. Our vision is to establish GIFT IFSC as a Dominant Gateway for global financial flows into and out of India, and simultaneously emerge as a major global financial hub.”

The committee suggests that the IFSC can aim at:

(i) Becoming a gateway to India growth story for international investors and business

(ii) Providing Indian diaspora and individuals from Asia and Africa with a comprehensive range of financial services from the IFSC.

(iii) Serving domestic residents availing liberalized remittance scheme.

Further, the IFSC with its approach of “FinServe from IFSC” would complement the ‘Make in India’ vision of the Government of India. “There is immense immediate potential to promote international retail business in IFSC, and if done efficiently, it will meet three key objectives – boost job creation, generate additional revenue for India, and attract funds (especially from the Indian diaspora) for building India’s infrastructure. The IFSC must aim to provide best in class jurisdictions and aim to build its competitiveness in terms of key factors like reputation, regulatory environment, taxation and ease of operations,” said Pradip Shah, Chairman of the Expert Committee. The other members of the Expert Committee comprise G. Srinivasan, (Ex-CMD, New India Assurance Ltd.), Siddhartha Sengupta, (ex-DMD, State Bank of India), Shyamal Mukherjee (chairman, PWC), Prakash Subramanian (head-strategy, Standard Chartered Bank), Dipesh Shah (head-IFSC dept., GIFT IFSC) and Nitin Jaiswal (head-Govt Affairs and Strategic relations, Bloomberg, Asia Pacific).

The Government of India had constituted the IFSCA with Shri I Srinivas as its Chairperson earlier this year to develop and regulate the financial services market in the IFSC in India. Apart from channelizing India's offshore business to the IFSC located at GIFT City and making it the gateway for India centric international financial services, the objective is to make it a global hub for international financial services on the lines of London, Hong Kong, Singapore, and Dubai.