India's first International Financial Services Centre (IFSC) at GIFT City near here became operational today and Finance Minister Arun Jaitley unveiled rules and regulations for this global financial hub.
Jaitley also attacked the previous UPA government for being "lethargic" in giving permission to the IFSC.
"Luckily, as soon as the government changed, things started moving fast and the new government has given all the due permissions. As a result, IFSC has now formally become operational from today. I am confident it will provide a huge lift to the economy of Gujarat as well as of the country," he said.
The regulations are aimed at creating a vibrant IFSC on the lines of those in Dubai and Singapore and check the flight of trading in rupee and Indian securities to such offshore financial hubs.
IFSC rules allow companies incorporated outside India to raise money in foreign currencies by issuance and listing of their equity shares on stock exchanges within the IFSC, where individual and institutional investors from India and abroad, including NRIs, would be allowed to trade.
The IFSC regulatory regime allows Indian and foreign stock exchanges to set up separate bourses within IFSC as subsidiaries, while market entities from India and abroad would be allowed to operate there by providing issuance and trading in depository receipts and debt securities of domestic as well as overseas companies.
The capital and other requirements have been relaxed for some time for exchanges, clearing corporations and depositories to set shop in the IFSC.
Mutual funds and Alternative Investment Funds set up in the IFSC can also invest in the securities listed there.
Speaking at a conference on 'Regulatory Framework for IFSC in India', Jaitley said proposal for IFSC had been sent to UPA government by the state in 2011, but "due to the lethargic attitude of that government, we have to wait for three years to realise that idea" and it "contributed in bringing down India's growth rate".
