The entry of JPMorgan, Deutsche and MUFG to give Gift City a big boost

The City of gifts in Gujarat is about to get its biggest boost yet in becoming India’s hub for global finance as Prime Minister Narendra Mode is likely to officially begin operations at JPMorgan Chase, Deutsche Bank and MUFG of Japan at the International Financial Services Center (IFSC) on July 15, three people familiar with the matter said.

These institutions are some of the largest in the global loan and derivatives markets, which amount to trillions of dollars.

Finance Minister Nirmala Sitharaman will also attend the event. But the schedule is subject to change depending on the prime minister’s other commitments, the people said, speaking on condition of anonymity.

Meanwhile, a 10-member delegation comprising senior officials from the International Financial Services Center (IFSCA) and foreign banks setting up shop at GIFT City is currently in London to woo international investors, the people said. “He is expected to meet around 150 investors in London,” one of the people told ET.

The Gift City, JPMorgan, Deutsche Bank and the IFSCA, which also regulate businesses in the special economic zone, did not comment. A spokesman for MUFG said the financial services company was “on track to open our branch in the first half of the financial year”.

The new development bank, a supranational lender, will also begin operations.

The Prime Minister may also open several specialized platforms to attract global investors. These include Agritech to help local farmers find international buyers for their produce and a fintech platform for lenders to digitally process loan applications with limited human intervention.

GIFT City is rapidly gaining popularity after the pandemic with a sharp increase in business volume.

Between April 2015 and September 2020, approximately 129 businesses set up shop there. Since then, more than 180 organizations have set up base in GIFT City, according to people in the know.

IFSCA already expects at least 400 applications in the current fiscal year 2023. It has already received about 50 applications by the end of June, the people said.

“In fact, IFSCA selected about five applications from well-known fintech companies,” one of the people said.

Reinsurance and aircraft leasing are two important aspects of business other than banking that GIFT City authorities pay special attention to.

It is expected that during his visit to the City of Gifts, the Prime Minister will also meet with representatives of the industry, participants in the programs announced. More than 50 alternative investment funds, both onshore and offshore, are waiting to enter GIFT City, IFSCA chairman Injeti Srinivas said.

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