IFSCA Annual Report 2023-24 English

2023-24 This report is in conformity with the form prescribed in the International Financial Services Centres Authority (Annual Report and Returns and Statements and Other Particulars) Rules, 2022 notified on February 28, 2022, in the Gazette of India.2023-242023-242023-24 STATEMENT OF GOALS & OBJECTIVES The International Financial Services Centres Authority (IFSCA) was set up by the Government of India on April 27, 2020, as a unified financial regulator under the International Financial Services Centres Authority Act, 2019. It is headquartered at Gujarat International Finance Tec-City (GIFT City), Gandhinagar in Gujarat. The main objective of IFSCA (hereinafter referred to as “the Authority”) is to develop and regulate financial services in the International Financial Services Centres (IFSCs) established in India, with a mandate to create a world-class financial ecosystem with ease of doing business and best-in-class regulatory system with a view to making IFSCs a preferred global destination for international financial services. IFSCA is a unified financial regulator, having power to regulate banking, capital market, insurance, and pension funds, with powers of RBI, SEBI, IRDAI and PFRDA being assigned to IFSCA for regulation of IFSCs. IFSCA adopts a holistic vision towards the development and regulation of financial products, financial services, and financial institutions in IFSCs in India. The GIFT IFSC is the maiden International Financial Services Centre in India. Vision To provide world-class regulatory environment and develop IFSCs with primary focus on accelerating India's economic development, besides serving as a regional and global financial hub. Mission To develop IFSCs into well-diversified and globally competitive financial hubs for international banking, insurance, and capital market activities through a pro-business environment, duly supported by a progressive regulatory architecture, state-of-the-art technology and infrastructure, and talented financial professionals, which serve both the Indian economy and the region as a whole. Goals & Objectives (i) To facilitate the development of a strong base of international financial services in India (ii) To promote IFSCs as a dominant gateway for international capital flows into and out of India (iii) To emerge as a regional and global hub for international financial services (iv) To provide a state-of-the-art unified regulatory framework, with robust regulation and supervisory technology aligned with international best practices (v) To develop a strong global, connect with leading international financial jurisdictions2023-24 STATEMENT OF GOALS & OBJECTIVES The International Financial Services Centres Authority (IFSCA) was set up by the Government of India on April 27, 2020, as a unified financial regulator under the International Financial Services Centres Authority Act, 2019. It is headquartered at Gujarat International Finance Tec-City (GIFT City), Gandhinagar in Gujarat. The main objective of IFSCA (hereinafter referred to as “the Authority”) is to develop and regulate financial services in the International Financial Services Centres (IFSCs) established in India, with a mandate to create a world-class financial ecosystem with ease of doing business and best-in-class regulatory system with a view to making IFSCs a preferred global destination for international financial services. IFSCA is a unified financial regulator, having power to regulate banking, capital market, insurance, and pension funds, with powers of RBI, SEBI, IRDAI and PFRDA being assigned to IFSCA for regulation of IFSCs. IFSCA adopts a holistic vision towards the development and regulation of financial products, financial services, and financial institutions in IFSCs in India. The GIFT IFSC is the maiden International Financial Services Centre in India. Vision To provide world-class regulatory environment and develop IFSCs with primary focus on accelerating India's economic development, besides serving as a regional and global financial hub. Mission To develop IFSCs into well-diversified and globally competitive financial hubs for international banking, insurance, and capital market activities through a pro-business environment, duly supported by a progressive regulatory architecture, state-of-the-art technology and infrastructure, and talented financial professionals, which serve both the Indian economy and the region as a whole. Goals & Objectives (i) To facilitate the development of a strong base of international financial services in India (ii) To promote IFSCs as a dominant gateway for international capital flows into and out of India (iii) To emerge as a regional and global hub for international financial services (iv) To provide a state-of-the-art unified regulatory framework, with robust regulation and supervisory technology aligned with international best practices (v) To develop a strong global, connect with leading international financial jurisdictions2023-24 CHAIRPERSON'S MESSAGE I am delighted to present this report, reflecting on the remarkable journey and progress of the International Financial Services Centres Authority (IFSCA). Since its inception in 2020, IFSCA has diligently worked towards establishing a robust regulatory framework aligned with global standards and practices within the GIFT IFSC. This endeavour has been bolstered by the unwavering support extended by the Government of India, which has provided a competitive tax regime and spearheaded key policy reforms, fostering an environment conducive to financial innovation and growth. Noting the progress made by GIFT IFSC, Hon'ble Prime Minister Shri Shri K Rajaraman Narendra Modi in his address during Infinity Forum 2.0 outlined his Chairperson, IFSCA vision as follows “India being a ray of hope for the world, a result of its strengthening economy and transformative reforms of past decade. We want to make GIFT city the Global Nerve Centre of New Age financial services.” Guided by this vision, IFSCA has been at the forefront of innovation by constantly benchmarking its gegulations with the best jurisdictions. GIFT IFSC was commended in the presentation of the interim Budget for 2024-25. In her address, Hon'ble Finance Minister, Smt. Nirmala Sitharaman stated that, "GIFT IFSC and the unified regulatory authority, IFSCA, are creating a robust gateway for global capital and financial services for the economy". This acknowledgment highlights the critical role played by the IFSCA and the GIFT IFSC in bolstering the economy and fostering an environment conducive to attracting global capital and financial services. IFSCA is committed to fostering a vibrant and competitive ecosystem within the GIFT IFSC. Following the announcement by Hon'ble Finance Minister in 2023, IFSCA is poised to release the final norms for direct listing at GIFT IFSC by early July, a testament to our dedication to facilitating seamless access to international capital markets. Our focus is towards leveraging GIFT IFSC's competitive regulatory foundation to attract global financial sector firms to serve India and the region. Indian-owned businesses that have historically operated from overseas jurisdictions are now setting up businesses in GIFT IFSC. Registration of prominent ship lessors and the successful leasing of bulk carriers through GIFT City signals a promising trajectory for India's maritime industry. Our ongoing efforts in fostering international collaboration in the global financial landscape include signing of a Memorandum of Understanding (MoU) between IFSCA and the Financial Services Commission, Mauritius (FSC Mauritius) and the Multi-lateral Memorandum of Understanding (MMoU) with International Association of Insurance Supervisors (IAIS), of which IFSCA is a member. These MoUs enable IFSCA to connect the GIFT IFSC ecosystem with other financial centres. As we continue to expand our horizons, we remain committed to nurturing and attracting global and domestic talent pool to GIFT IFSC. New Regulations relating to export of business accounting, compliance services, and auditing services from IFSC are in line with our commitment to positioning GIFT IFSC as a global hub for financial services. I am also proud to announce that IFSCA has granted registration to 7 International Banking Units (IBUs), 59 Fund Management Entities (FMEs), 71 Alternate Investment Funds (AIFs), 6 IFSC Insurance Offices (IIOs), 6 IFSC Insurance Intermediary Offices (IIIOs) amongst key regulated entities licensed by IFSCA in 2023-24. This is proof of strong domestic and global participation in the GIFT IFSC's growth story.2023-24 CHAIRPERSON'S MESSAGE I am delighted to present this report, reflecting on the remarkable journey and progress of the International Financial Services Centres Authority (IFSCA). Since its inception in 2020, IFSCA has diligently worked towards establishing a robust regulatory framework aligned with global standards and practices within the GIFT IFSC. This endeavour has been bolstered by the unwavering support extended by the Government of India, which has provided a competitive tax regime and spearheaded key policy reforms, fostering an environment conducive to financial innovation and growth. Noting the progress made by GIFT IFSC, Hon'ble Prime Minister Shri Shri K Rajaraman Narendra Modi in his address during Infinity Forum 2.0 outlined his Chairperson, IFSCA vision as follows “India being a ray of hope for the world, a result of its strengthening economy and transformative reforms of past decade. We want to make GIFT city the Global Nerve Centre of New Age financial services.” Guided by this vision, IFSCA has been at the forefront of innovation by constantly benchmarking its gegulations with the best jurisdictions. GIFT IFSC was commended in the presentation of the interim Budget for 2024-25. In her address, Hon'ble Finance Minister, Smt. Nirmala Sitharaman stated that, "GIFT IFSC and the unified regulatory authority, IFSCA, are creating a robust gateway for global capital and financial services for the economy". This acknowledgment highlights the critical role played by the IFSCA and the GIFT IFSC in bolstering the economy and fostering an environment conducive to attracting global capital and financial services. IFSCA is committed to fostering a vibrant and competitive ecosystem within the GIFT IFSC. Following the announcement by Hon'ble Finance Minister in 2023, IFSCA is poised to release the final norms for direct listing at GIFT IFSC by early July, a testament to our dedication to facilitating seamless access to international capital markets. Our focus is towards leveraging GIFT IFSC's competitive regulatory foundation to attract global financial sector firms to serve India and the region. Indian-owned businesses that have historically operated from overseas jurisdictions are now setting up businesses in GIFT IFSC. Registration of prominent ship lessors and the successful leasing of bulk carriers through GIFT City signals a promising trajectory for India's maritime industry. Our ongoing efforts in fostering international collaboration in the global financial landscape include signing of a Memorandum of Understanding (MoU) between IFSCA and the Financial Services Commission, Mauritius (FSC Mauritius) and the Multi-lateral Memorandum of Understanding (MMoU) with International Association of Insurance Supervisors (IAIS), of which IFSCA is a member. These MoUs enable IFSCA to connect the GIFT IFSC ecosystem with other financial centres. As we continue to expand our horizons, we remain committed to nurturing and attracting global and domestic talent pool to GIFT IFSC. New Regulations relating to export of business accounting, compliance services, and auditing services from IFSC are in line with our commitment to positioning GIFT IFSC as a global hub for financial services. I am also proud to announce that IFSCA has granted registration to 7 International Banking Units (IBUs), 59 Fund Management Entities (FMEs), 71 Alternate Investment Funds (AIFs), 6 IFSC Insurance Offices (IIOs), 6 IFSC Insurance Intermediary Offices (IIIOs) amongst key regulated entities licensed by IFSCA in 2023-24. This is proof of strong domestic and global participation in the GIFT IFSC's growth story.2023-24 MEMBERS OF THE AUTHORITY In alignment with Government of India's vision for Viksit Bharat@2047, we are dedicated to empowering Indian businesses to gain access to cost-effective and diverse forms of international (As on 31.03.2024) capital and financial services. The forthcoming task of implementing a real-time payment settlement mechanism by the Q4 of 2024 is intended to boost the efficiency of the IFSC financial markets. While we continue to innovate, IFSCA is also conscious of the need to maintain fairness, transparency and integrity in IFSC markets. Protecting investors is a very important task and IFSCA has commenced onsite and offsite supervision of regulated entities. IFSCA is constantly monitoring compliance with AML and CFT regulations and take all measures to safeguard GIFT IFSC’s reputation as a safe and secure financial marketplace for investors. As we reflect on our achievements and look towards the future, I am confident that with continued collaboration and support from all stakeholders, GIFT IFSC will emerge as a beacon of financial excellence, serving as a Global Platform for raising capital for ViksitBharat@2047 and cementing its position on the global financial map. Thank you for your unwavering support and commitment to IFSCA's vision. Shri K Rajaraman Chairperson, IFSCA Shri Pankaj Sharma Member Shri Pramod Rao Shri Ananta Gopal Das Shri Pramod Kumar Arora Member Member Member2023-24 MEMBERS OF THE AUTHORITY In alignment with Government of India's vision for Viksit Bharat@2047, we are dedicated to empowering Indian businesses to gain access to cost-effective and diverse forms of international (As on 31.03.2024) capital and financial services. The forthcoming task of implementing a real-time payment settlement mechanism by the Q4 of 2024 is intended to boost the efficiency of the IFSC financial markets. While we continue to innovate, IFSCA is also conscious of the need to maintain fairness, transparency and integrity in IFSC markets. Protecting investors is a very important task and IFSCA has commenced onsite and offsite supervision of regulated entities. IFSCA is constantly monitoring compliance with AML and CFT regulations and take all measures to safeguard GIFT IFSC’s reputation as a safe and secure financial marketplace for investors. As we reflect on our achievements and look towards the future, I am confident that with continued collaboration and support from all stakeholders, GIFT IFSC will emerge as a beacon of financial excellence, serving as a Global Platform for raising capital for ViksitBharat@2047 and cementing its position on the global financial map. Thank you for your unwavering support and commitment to IFSCA's vision. Shri K Rajaraman Chairperson, IFSCA Shri Pankaj Sharma Member Shri Pramod Rao Shri Ananta Gopal Das Shri Pramod Kumar Arora Member Member Member2023-24 SENIOR MANAGEMENT OF THE AUTHORITY TABLE OF CONTENTS (As on 31.03.2024) A SECTION – A V Sh. Praveen Trivedi Executive Director Statement of Goals & Objectives VII Chairperson’s Message IX Sh. Dipesh Shah Executive Director Members of The Authority (as on 31.03.2024) XI Sh. Pradeep Ramakrishnan Executive Director Senior Management of the Authority (as on 31.03.2024) XII Sh. Kumar Raghuraman Chief General Manager List of Tables XIV Sh. Supriyo Bhattacharjee Chief General Manager List of Figures XVI Sh. Ashutosh Sharma Chief General Manager List of Boxes XVII Sh. Kamlesh Sharma Chief General Manager List of Images XVII Abbreviations XX Sh. Joseph Joshy C J Chief General Manager SECTION – B: The Year in Review: Overview of the General 1 B Economic Environment Global Economy Assessment and Outlook 2 India: Economic Assessment and Prospects 6 SECTION – C: Review of Policies, Programmes and Activities of 13 C the Authority Banking 14 Finance Companies 24 Capital Markets 30 Fund Management 46 Metals and Commodities 52 FinTech 60 Insurance 72 Global In-House Centres 80 Sustainable Finance 82 Ancillary Services 90 Foreign Universities & Institutions 94 Information Technology 982023-24 SENIOR MANAGEMENT OF THE AUTHORITY TABLE OF CONTENTS (As on 31.03.2024) A SECTION – A V Sh. Praveen Trivedi Executive Director Statement of Goals & Objectives VII Chairperson’s Message IX Sh. Dipesh Shah Executive Director Members of The Authority (as on 31.03.2024) XI Sh. Pradeep Ramakrishnan Executive Director Senior Management of the Authority (as on 31.03.2024) XII Sh. Kumar Raghuraman Chief General Manager List of Tables XIV Sh. Supriyo Bhattacharjee Chief General Manager List of Figures XVI Sh. Ashutosh Sharma Chief General Manager List of Boxes XVII Sh. Kamlesh Sharma Chief General Manager List of Images XVII Abbreviations XX Sh. Joseph Joshy C J Chief General Manager SECTION – B: The Year in Review: Overview of the General 1 B Economic Environment Global Economy Assessment and Outlook 2 India: Economic Assessment and Prospects 6 SECTION – C: Review of Policies, Programmes and Activities of 13 C the Authority Banking 14 Finance Companies 24 Capital Markets 30 Fund Management 46 Metals and Commodities 52 FinTech 60 Insurance 72 Global In-House Centres 80 Sustainable Finance 82 Ancillary Services 90 Foreign Universities & Institutions 94 Information Technology 982023-24 Developmental Activities 102 Table 16 Turnover in Currency Derivatives 39 D SECTION – D: Quasi Legislative Functions of the Authority 119 Table 17 Number of Registered FMEs 48 E SECTION – E: Performance Assessment 131 Table 18 Investment by Fund Management Schemes 49 SECTION – F: Source of Funds and Major Areas of Expenditure 135 Table 19 FMEs Providing PMS 49 F (FY 2023-24) Table 20 Spot Products Available on IIBX (Gold) 53 G SECTION – G: Organisational Matters 137 Table 21 Spot Products Available on IIBX (Silver) 53 Table 22 Registered Bullion Market Intermediaries at GIFT IFSC 55 Table 23 MoUs with FinTech Hubs and Educational Institutions 64 During FY 2023-24 Table 24 Listing of Debt Securities at IFSC Exchanges (in USD Bn) 83 Table 25 Debt listing in FY 2023-24 84 Table 1 No. of IBUs 18 Table 26 Overall Sustainable Financing by IBUs 85 Table 2 Total Assets in IBUs in USD Mn 18 Table 27 Sector-wise Classification of Sustainable Financing by IBUs 85 Table 3 No. of Employees in all IBUs 18 Table 28 Activity-wise Break Up of Ancillary Services Entities 91 Table 4 Derivative Outstanding (USD Mn) 20 Table 29 Key Outreach and Engagement Activities of IFSCA During 112 Table 5 Registered Finance Companies as on March 31, 2024 25 FY 2023-24 Table 6 Aircraft Operating Lease (AOL) Entities 25 Table 30 List of Regulations 121 Table 7 Ship Leasing Entities 25 Table 31 List of Major Notifications 123 Table 8 ITFS Platforms 25 Table 32 List of Major Circulars/guidelines 125 Table 9 Broker Dealers in IFSC (as on March 31, 2024) 35 Table 33 Source of Funds for FY 2023-24 136 Table 10 Clearing Members in IFSC (as on March 31, 2024) 35 Table 34 Break Up of Government Grants for FY 2023-24 136 Table 11 No. of Contracts and Turnover in Index Futures 37 Table 35 Major Areas of Expenditure for FY 2023-24 136 Table 12 No. of Contracts and Premium Turnover in 38 Table 36 Authority Structure as on March 31, 2024 138 Index Options Table 37 IFSC Authority Meetings Held in FY 2023-24 139 Table 13 Commodities Derivatives Available for 38 Trading on the IFSC Exchanges Table 38 Sanctioned and Actual Strength of Employees 140 Table 14 Turnover in Commodity Derivatives on India INX 38 Table 39 Consultants at IFSCA as on March 31, 2024 141 Table 15 Currency Derivatives 38 Table 40 Status of RTI Applications During FY 2023-24 1412023-24 Developmental Activities 102 Table 16 Turnover in Currency Derivatives 39 D SECTION – D: Quasi Legislative Functions of the Authority 119 Table 17 Number of Registered FMEs 48 E SECTION – E: Performance Assessment 131 Table 18 Investment by Fund Management Schemes 49 SECTION – F: Source of Funds and Major Areas of Expenditure 135 Table 19 FMEs Providing PMS 49 F (FY 2023-24) Table 20 Spot Products Available on IIBX (Gold) 53 G SECTION – G: Organisational Matters 137 Table 21 Spot Products Available on IIBX (Silver) 53 Table 22 Registered Bullion Market Intermediaries at GIFT IFSC 55 Table 23 MoUs with FinTech Hubs and Educational Institutions 64 During FY 2023-24 Table 24 Listing of Debt Securities at IFSC Exchanges (in USD Bn) 83 Table 25 Debt listing in FY 2023-24 84 Table 1 No. of IBUs 18 Table 26 Overall Sustainable Financing by IBUs 85 Table 2 Total Assets in IBUs in USD Mn 18 Table 27 Sector-wise Classification of Sustainable Financing by IBUs 85 Table 3 No. of Employees in all IBUs 18 Table 28 Activity-wise Break Up of Ancillary Services Entities 91 Table 4 Derivative Outstanding (USD Mn) 20 Table 29 Key Outreach and Engagement Activities of IFSCA During 112 Table 5 Registered Finance Companies as on March 31, 2024 25 FY 2023-24 Table 6 Aircraft Operating Lease (AOL) Entities 25 Table 30 List of Regulations 121 Table 7 Ship Leasing Entities 25 Table 31 List of Major Notifications 123 Table 8 ITFS Platforms 25 Table 32 List of Major Circulars/guidelines 125 Table 9 Broker Dealers in IFSC (as on March 31, 2024) 35 Table 33 Source of Funds for FY 2023-24 136 Table 10 Clearing Members in IFSC (as on March 31, 2024) 35 Table 34 Break Up of Government Grants for FY 2023-24 136 Table 11 No. of Contracts and Turnover in Index Futures 37 Table 35 Major Areas of Expenditure for FY 2023-24 136 Table 12 No. of Contracts and Premium Turnover in 38 Table 36 Authority Structure as on March 31, 2024 138 Index Options Table 37 IFSC Authority Meetings Held in FY 2023-24 139 Table 13 Commodities Derivatives Available for 38 Trading on the IFSC Exchanges Table 38 Sanctioned and Actual Strength of Employees 140 Table 14 Turnover in Commodity Derivatives on India INX 38 Table 39 Consultants at IFSCA as on March 31, 2024 141 Table 15 Currency Derivatives 38 Table 40 Status of RTI Applications During FY 2023-24 1412023-24 Figure 1 Outstanding of Major Credit Products (USD Mn) 19 Box 1 Major features of the Direct Listing Scheme 31 Figure 2 Turnover (Volume of Business) in USD Mn 19 Box 2 GIFT Connect 33 Figure 3 Investment Profile in USD Mn 20 Box 3 Regulatory Framework for Accredited Investors in IFSC 47 Figure 4 Major Country Exposure of IBUs 21 Box 4 Making GIFT IFSC a Global Accounting Hub 92 Figure 5 Number of Finance Companies in IFSC 26 Box 5 Key features of the AISP Circular 95 Figure 6 Turnover of Stock Exchanges (USD Mn) 37 Box 6 IFSCA Single Window IT System (SWITS) 98 Figure 7 Turnover on Stock Exchanges in FY 2022-23 and FY 2023-24 39 Figure 8 Bullion Market Ecosystem in IFSC 54 Figure 9 Comparative Analysis of Applications in Permissible Areas 62 Under FE Framework for FY 2022-23 and FY 2023-24 Image 1 International Conference on Role of IFSC in Export Credit and 22 Figure 10 Five Major Emerging Areas of Application in the TechFin 62 Export Credit Insurance Category in FY 2023-24 Image 2 Panelist For The Session on 23 “Closing The Trade Finance Gap: Policy Option” Figure 11 FinTech Entities Granted Limited Use Authorization Under FE 63 Framework for FY 2023-24 Image 3 Global Maritime Summit Panel with Hon’ble Finance Minister 27 Image 4 IFSCA Meeting with Ambassador of India to Ireland 27 Figure 12 Classification of IIOs 74 Image 5 Chairperson, IFSCA with Market Participants During a Round 40 Figure 13 Classification of IIIOs 75 Table in Singapore Image 6 Meeting of IFSCA and MAS 41 Figure 14 Business Underwritten by IIOs (USD Mn) 75 Image 7 Mr. Praveen Trivedi, Executive Director of IFSCA and 43 Figure 15 Business Transacted by IIIOs (USD Mn) 76 Mr. Saurabh Shah, Corporate Advisor ring The Closing Bell Ceremony of The IOSCO World Investor Week, 2023 Figure 16 Listing of ESG Debt Securities as of March 31, 2024 83 Hosted by India INX Figure 17 Listing of Debt Securities as of March 31, 2024 83 Image 8 Chairperson, IFSCA, Presiding The Roundtable Discussion 50 with Large Global Funds Figure 18 Schematic Representation of SWIT System 99 Image 9 Shri Pradeep Ramakrishnan, Executive Director, with other 50 Dignitaries During IVCA Conclave 2024 Image 10 Chairperson, IFSCA Addressing The Audience During IVCA 51 Private Credit Summit 2023 Image 11 IFSCA signing MoU with Ahmedabad University, KSUM, STPI, 64 PIEDS, FIRST, Enterprise Incubation Centre Image 12 Hon’ble Prime Minister of India Inaugurating 65 The Infinity Forum 2.0 Image 13 Investors Meet 2023 in GIFT City 66 Image 14 Global Fintech Festival 2023 in Mumbai 67 Image 15 IFSCA Booth in Global Fintech Festival 2023 672023-24 Figure 1 Outstanding of Major Credit Products (USD Mn) 19 Box 1 Major features of the Direct Listing Scheme 31 Figure 2 Turnover (Volume of Business) in USD Mn 19 Box 2 GIFT Connect 33 Figure 3 Investment Profile in USD Mn 20 Box 3 Regulatory Framework for Accredited Investors in IFSC 47 Figure 4 Major Country Exposure of IBUs 21 Box 4 Making GIFT IFSC a Global Accounting Hub 92 Figure 5 Number of Finance Companies in IFSC 26 Box 5 Key features of the AISP Circular 95 Figure 6 Turnover of Stock Exchanges (USD Mn) 37 Box 6 IFSCA Single Window IT System (SWITS) 98 Figure 7 Turnover on Stock Exchanges in FY 2022-23 and FY 2023-24 39 Figure 8 Bullion Market Ecosystem in IFSC 54 Figure 9 Comparative Analysis of Applications in Permissible Areas 62 Under FE Framework for FY 2022-23 and FY 2023-24 Image 1 International Conference on Role of IFSC in Export Credit and 22 Figure 10 Five Major Emerging Areas of Application in the TechFin 62 Export Credit Insurance Category in FY 2023-24 Image 2 Panelist For The Session on 23 “Closing The Trade Finance Gap: Policy Option” Figure 11 FinTech Entities Granted Limited Use Authorization Under FE 63 Framework for FY 2023-24 Image 3 Global Maritime Summit Panel with Hon’ble Finance Minister 27 Image 4 IFSCA Meeting with Ambassador of India to Ireland 27 Figure 12 Classification of IIOs 74 Image 5 Chairperson, IFSCA with Market Participants During a Round 40 Figure 13 Classification of IIIOs 75 Table in Singapore Image 6 Meeting of IFSCA and MAS 41 Figure 14 Business Underwritten by IIOs (USD Mn) 75 Image 7 Mr. Praveen Trivedi, Executive Director of IFSCA and 43 Figure 15 Business Transacted by IIIOs (USD Mn) 76 Mr. Saurabh Shah, Corporate Advisor ring The Closing Bell Ceremony of The IOSCO World Investor Week, 2023 Figure 16 Listing of ESG Debt Securities as of March 31, 2024 83 Hosted by India INX Figure 17 Listing of Debt Securities as of March 31, 2024 83 Image 8 Chairperson, IFSCA, Presiding The Roundtable Discussion 50 with Large Global Funds Figure 18 Schematic Representation of SWIT System 99 Image 9 Shri Pradeep Ramakrishnan, Executive Director, with other 50 Dignitaries During IVCA Conclave 2024 Image 10 Chairperson, IFSCA Addressing The Audience During IVCA 51 Private Credit Summit 2023 Image 11 IFSCA signing MoU with Ahmedabad University, KSUM, STPI, 64 PIEDS, FIRST, Enterprise Incubation Centre Image 12 Hon’ble Prime Minister of India Inaugurating 65 The Infinity Forum 2.0 Image 13 Investors Meet 2023 in GIFT City 66 Image 14 Global Fintech Festival 2023 in Mumbai 67 Image 15 IFSCA Booth in Global Fintech Festival 2023 672023-24 Image 16 IFSCA with Participants of FinTech Founders Meet in Bangalore 68 Image 39 Cleanliness Drive at PDPU Bridge GIFT City as Part of Image 17 IFSCA Participating in the Panel Discussion in Intersekt 23 69 ‘Swachhata Pakhwada - Swachhata Hi Seva (SHS) 2023’ 143 by IFSCA Employees Image 18 Chairperson, IFSCA at Singapore FinTech Festival 2023 70 Image 40 IFSCA Officers taking Vigilance Pledge as Part of Vigilance 144 Image 19 Dignitaries from IAIS and IFSCA during The signing of MMoU 77 Awareness Week Image 20 Chairperson, IFSCA, during Insurance Roadshow at Tokyo, Japan 77 Image 41 Visit of Statue of Unity, as Part of Chintan Shivir 2024 145 Image 21 Dignitaries during the Inaugural Session “Vision Track” 78 Image 42 City Tour, as Part of Chintan Shivir 2024 146 Image 22 Panel Discussion on “To Develop India as Re-Insurance Hub” 79 Image 43 Flag Hoisting Ceremony on 75 Republic Day 146 Image 23 Shri Dipesh Shah, ED, IFSCA addressing in GCC (CXO Meet) 81 Image 44 Flag Hoisting on 77 Independence Day Celebration 147 Image 24 Chairperson, IFSCA at the Inaugural Session of 88 the Climate Conference Image 25 Deakin University in GIFT IFSC 96 Image 26 Exchange of MoU ICAI with IFSCA and GIFT City 103 Image 27 Submission of Report to Chairperson, IFSCA by Expert 104 Committee on BATF Image 28 Shri Pradeep Ramakrishnan, ED, IFSCA with Dignitaries 106 at the PSE@2047 Image 29 Hon’ble Union Minister of Finance and Corporate Affairs 107 Smt. Nirmala Sitharaman visited IFSCA Head Office Image 30 IFSCA Delegation led by Shri K Rajaraman, Chairperson, IFSCA met Mr Jerome Reboul, Deputy Secretary General 107 and Managing Director of Dept. of International Affairs, AMF France at their Headquarters Image 31 Chairperson, IFSCA addressing the Officials of Luxembourg 108 Stock Exchange (LSE) Image 32 Plenary Session “GIFT City – An Aspiration of Modern India” 109 in Vibrant Gujarat 2024” Image 33 Shri K Rajaraman, Chairperson, IFSCA addressing during Interaction with Japanese Businesses at IRDAI Insurance 109 Conventions used in this report Roadshow (Embassy of India, Tokyo) Image 34 IFSCA Delegation led by Chairperson, IFSCA met Mr. Toshiyuki, ₹ : Rupees (Rs) Vice-Commissioner For International Affairs, FSA, Japan 110 Lakh : Hundred thousand Image 35 Opening Bell Ceremony at NASDAQ 110 Crore : Ten million Million (Mn) : Ten lakh Image 36 Conference on GIFT IFSC Opportunities 111 Billion (Bn) : Thousand million/hundred crore Image 37 IFSCA Employees Taking Swachhta Pledge administered 142 Differences in total are due to rounding off and sometimes they may not exactly add up by Chairperson, IFSCA to hundred per cent. Image 38 Walkathon as Part of ‘Swachhata Pakhwada - Swachhata Hi Seva’ 142 This report can also be accessed on internet at: https://www.ifsca.gov.in/2023-24 Image 16 IFSCA with Participants of FinTech Founders Meet in Bangalore 68 Image 39 Cleanliness Drive at PDPU Bridge GIFT City as Part of Image 17 IFSCA Participating in the Panel Discussion in Intersekt 23 69 ‘Swachhata Pakhwada - Swachhata Hi Seva (SHS) 2023’ 143 by IFSCA Employees Image 18 Chairperson, IFSCA at Singapore FinTech Festival 2023 70 Image 40 IFSCA Officers taking Vigilance Pledge as Part of Vigilance 144 Image 19 Dignitaries from IAIS and IFSCA during The signing of MMoU 77 Awareness Week Image 20 Chairperson, IFSCA, during Insurance Roadshow at Tokyo, Japan 77 Image 41 Visit of Statue of Unity, as Part of Chintan Shivir 2024 145 Image 21 Dignitaries during the Inaugural Session “Vision Track” 78 Image 42 City Tour, as Part of Chintan Shivir 2024 146 Image 22 Panel Discussion on “To Develop India as Re-Insurance Hub” 79 Image 43 Flag Hoisting Ceremony on 75 Republic Day 146 Image 23 Shri Dipesh Shah, ED, IFSCA addressing in GCC (CXO Meet) 81 Image 44 Flag Hoisting on 77 Independence Day Celebration 147 Image 24 Chairperson, IFSCA at the Inaugural Session of 88 the Climate Conference Image 25 Deakin University in GIFT IFSC 96 Image 26 Exchange of MoU ICAI with IFSCA and GIFT City 103 Image 27 Submission of Report to Chairperson, IFSCA by Expert 104 Committee on BATF Image 28 Shri Pradeep Ramakrishnan, ED, IFSCA with Dignitaries 106 at the PSE@2047 Image 29 Hon’ble Union Minister of Finance and Corporate Affairs 107 Smt. Nirmala Sitharaman visited IFSCA Head Office Image 30 IFSCA Delegation led by Shri K Rajaraman, Chairperson, IFSCA met Mr Jerome Reboul, Deputy Secretary General 107 and Managing Director of Dept. of International Affairs, AMF France at their Headquarters Image 31 Chairperson, IFSCA addressing the Officials of Luxembourg 108 Stock Exchange (LSE) Image 32 Plenary Session “GIFT City – An Aspiration of Modern India” 109 in Vibrant Gujarat 2024” Image 33 Shri K Rajaraman, Chairperson, IFSCA addressing during Interaction with Japanese Businesses at IRDAI Insurance 109 Conventions used in this report Roadshow (Embassy of India, Tokyo) Image 34 IFSCA Delegation led by Chairperson, IFSCA met Mr. Toshiyuki, ₹ : Rupees (Rs) Vice-Commissioner For International Affairs, FSA, Japan 110 Lakh : Hundred thousand Image 35 Opening Bell Ceremony at NASDAQ 110 Crore : Ten million Million (Mn) : Ten lakh Image 36 Conference on GIFT IFSC Opportunities 111 Billion (Bn) : Thousand million/hundred crore Image 37 IFSCA Employees Taking Swachhta Pledge administered 142 Differences in total are due to rounding off and sometimes they may not exactly add up by Chairperson, IFSCA to hundred per cent. Image 38 Walkathon as Part of ‘Swachhata Pakhwada - Swachhata Hi Seva’ 142 This report can also be accessed on internet at: https://www.ifsca.gov.in/2023-24 ABBREVIATIONS ESG Environmental, Social or Governance EUR Euro ACFIT Audit Papers, Compel Attendance, Freeze Assets, Internet Records, Telephone Records EXIM Export Import Bank of India ACLI American Council of Life Insurers FC Finance Company AD Authorized Dealer FCA Financial Conduct Authority ADB Asian Development Bank FCY Foreign Currency AED UAE Dirham FEM (NDI) Foreign Exchange Management (Non-debt Instruments) AGM Annual General Meeting FICCI Federation of Indian Chambers of Commerce and Industry AI/ML Artificial Intelligence/ Machine Learning FIRST Foundation For Innovation & Research in Science & Technology AIF Alternative Investment Funds FME Fund Management Entity ASSOCHAM Associated Chambers of Commerce and Industry of India FY Financial Year AUD Australian Dollar GBP UK Pound Sterling AUM Assets Under Management GDP Gross Domestic Product BCG Boston Consulting Group GFF Global FinTech Fest BFSI Banking, Financial Services and Insurance GFIN Global Financial Innovation Network BU Banking Units GIC Global In-house Centre CAD Canadian Dollar GIFT Gujarat International Finance-Tec City CAGR Compound Annual Growth Rate GNPA Gross Non-Performing Asset CBR Cross Border Reinsurers GSTIN Goods and Services Tax Identification Number CCP Central Counterparties GSTN Goods and Services Tax Network CDSL Central Depository Services Ltd. GVA Gross Value Added CEEW Council on Energy, Environment and Water GVFL Gujarat Venture Finance Limited CEPA Comprehensive Economic Partnership Agreement HKD Hong Kong Dollar CERT-In Indian Computer Emergency Response Team IAC International Arbitration Centre CHF Swiss Franc IAIS International Association of Insurance Supervisors CIN Corporate Identification Number IAMAI Internet and Mobile Association of India COB Conduct Of Business IBA Indian Banks Association CPI Consumer Price Index IBC IFSC Banking Company CRAR Capital to Risk (Weighted) Assets IBU IFSC Banking Unit DEA Department of Economic Affairs ICAI Institute of Chartered Accountants of India DFSA Dubai Financial Services Authority ICEGATE Indian Customs Electronic Gateway DGFT Directorate General of Foreign Trade ICES Indian Customs EDI System DIN Director Identification Number IDY International Day of Yoga EMMoU Enhanced Multilateral Memorandum of Understanding IFSC International Financial Services Centre EoDB Ease of Doing Business IFSCA International Financial Services Centres Authority e-OFFICE Electronic Office IIBX India International Bullion Exchange ERP Enterprise Resource Planning IIDI India International Depository IFSC Limited2023-24 ABBREVIATIONS ESG Environmental, Social or Governance EUR Euro ACFIT Audit Papers, Compel Attendance, Freeze Assets, Internet Records, Telephone Records EXIM Export Import Bank of India ACLI American Council of Life Insurers FC Finance Company AD Authorized Dealer FCA Financial Conduct Authority ADB Asian Development Bank FCY Foreign Currency AED UAE Dirham FEM (NDI) Foreign Exchange Management (Non-debt Instruments) AGM Annual General Meeting FICCI Federation of Indian Chambers of Commerce and Industry AI/ML Artificial Intelligence/ Machine Learning FIRST Foundation For Innovation & Research in Science & Technology AIF Alternative Investment Funds FME Fund Management Entity ASSOCHAM Associated Chambers of Commerce and Industry of India FY Financial Year AUD Australian Dollar GBP UK Pound Sterling AUM Assets Under Management GDP Gross Domestic Product BCG Boston Consulting Group GFF Global FinTech Fest BFSI Banking, Financial Services and Insurance GFIN Global Financial Innovation Network BU Banking Units GIC Global In-house Centre CAD Canadian Dollar GIFT Gujarat International Finance-Tec City CAGR Compound Annual Growth Rate GNPA Gross Non-Performing Asset CBR Cross Border Reinsurers GSTIN Goods and Services Tax Identification Number CCP Central Counterparties GSTN Goods and Services Tax Network CDSL Central Depository Services Ltd. GVA Gross Value Added CEEW Council on Energy, Environment and Water GVFL Gujarat Venture Finance Limited CEPA Comprehensive Economic Partnership Agreement HKD Hong Kong Dollar CERT-In Indian Computer Emergency Response Team IAC International Arbitration Centre CHF Swiss Franc IAIS International Association of Insurance Supervisors CIN Corporate Identification Number IAMAI Internet and Mobile Association of India COB Conduct Of Business IBA Indian Banks Association CPI Consumer Price Index IBC IFSC Banking Company CRAR Capital to Risk (Weighted) Assets IBU IFSC Banking Unit DEA Department of Economic Affairs ICAI Institute of Chartered Accountants of India DFSA Dubai Financial Services Authority ICEGATE Indian Customs Electronic Gateway DGFT Directorate General of Foreign Trade ICES Indian Customs EDI System DIN Director Identification Number IDY International Day of Yoga EMMoU Enhanced Multilateral Memorandum of Understanding IFSC International Financial Services Centre EoDB Ease of Doing Business IFSCA International Financial Services Centres Authority e-OFFICE Electronic Office IIBX India International Bullion Exchange ERP Enterprise Resource Planning IIDI India International Depository IFSC Limited2023-24 IIIO IFSC Insurance Intermediary Office ODI Offshore Derivative Instruments IIML Indian Institute of Management Lucknow OEC Offshore Education Centres IIO IFSC Insurance Office OFS Offer For Sale IMF International Monetary Fund OIS Overnight Indexed Swaps INR Indian Rupee OVL ONGC Videsh Ltd InvIT Infrastructure Investment Trust PAN Permanent Account Number IOSCO International Organization of Securities Commission PCI Payment Council of India IRDAI Insurance Regulatory and Development Authority of India PDPU Pandit Deendayal Petroleum University ISP Internet Service Provider PFRDA Pension Fund Regulatory and Development Authority ITeS Information Technology/ Information Technology enabled Services PoSH Prevention of Sexual Harassment ITC (HS) Indian Trade Clarification (Harmonized System) PRC Performance Review Committee ITFS International Trade Financing Services RBI Reserve Bank of India IVCA Indian Venture and Alternate Capital Association REIT Real Estate Investment Trust JFSA Japanese Financial Services Authority RFP Request For Proposal JPY Japanese Yen RoE Return on Equity LAN Local Area Network RTI Right To Information LBMA London Bullion Market Association RUB Russian Rouble LPTM Limited Purpose Trading Member SCB Scheduled Commercial Banks MAS Monetary Authority of Singapore SEBI Securities And Exchange Board of India MCA Ministry of Corporate Affairs SFC Superintendencia Financiera de Colombia MCLR Marginal Cost of Funds-based Lending Rate SGD Singapore Dollar MCX Multi Commodity Exchange SGrBs Sovereign Green Bonds MEPF Mechanical, Electrical, Plumbing, And Fire Protection SGX Singapore Stock Exchange MGA Managing General Agents SNRR Special Non- Resident Rupee Account MII Market Infrastructure Institutions SOP Standard Operating Procedure MIS Management Information Systems STPI Software Technology Parks of India MSME Ministry of Micro, Small & Medium Enterprises SWITS Single Window IT System MUFG Mitsubishi UFJ Financial Group TERI The Energy Research Institute NASSCOM National Association of Software and Service Companies TMCM Trading Member/Clearing Member NDF Non-Deliverable Forward TRQ Tariff Rate Quota NIC National Informatics Centre UAEGD UAE Good Delivery NICCL NSE IFSC Clearing Corporation Limited UK United Kingdom NIFTY National Stock Exchange Fifty UNDP United Nations Development Program NSCS National Security Council Secretariat USD United States Dollar NSDL National Securities Depository Limited WPI Wholesale Price Index NSE National Stock Exchange YoY Year on Year NSE IX NSE International Exchange2023-24 IIIO IFSC Insurance Intermediary Office ODI Offshore Derivative Instruments IIML Indian Institute of Management Lucknow OEC Offshore Education Centres IIO IFSC Insurance Office OFS Offer For Sale IMF International Monetary Fund OIS Overnight Indexed Swaps INR Indian Rupee OVL ONGC Videsh Ltd InvIT Infrastructure Investment Trust PAN Permanent Account Number IOSCO International Organization of Securities Commission PCI Payment Council of India IRDAI Insurance Regulatory and Development Authority of India PDPU Pandit Deendayal Petroleum University ISP Internet Service Provider PFRDA Pension Fund Regulatory and Development Authority ITeS Information Technology/ Information Technology enabled Services PoSH Prevention of Sexual Harassment ITC (HS) Indian Trade Clarification (Harmonized System) PRC Performance Review Committee ITFS International Trade Financing Services RBI Reserve Bank of India IVCA Indian Venture and Alternate Capital Association REIT Real Estate Investment Trust JFSA Japanese Financial Services Authority RFP Request For Proposal JPY Japanese Yen RoE Return on Equity LAN Local Area Network RTI Right To Information LBMA London Bullion Market Association RUB Russian Rouble LPTM Limited Purpose Trading Member SCB Scheduled Commercial Banks MAS Monetary Authority of Singapore SEBI Securities And Exchange Board of India MCA Ministry of Corporate Affairs SFC Superintendencia Financiera de Colombia MCLR Marginal Cost of Funds-based Lending Rate SGD Singapore Dollar MCX Multi Commodity Exchange SGrBs Sovereign Green Bonds MEPF Mechanical, Electrical, Plumbing, And Fire Protection SGX Singapore Stock Exchange MGA Managing General Agents SNRR Special Non- Resident Rupee Account MII Market Infrastructure Institutions SOP Standard Operating Procedure MIS Management Information Systems STPI Software Technology Parks of India MSME Ministry of Micro, Small & Medium Enterprises SWITS Single Window IT System MUFG Mitsubishi UFJ Financial Group TERI The Energy Research Institute NASSCOM National Association of Software and Service Companies TMCM Trading Member/Clearing Member NDF Non-Deliverable Forward TRQ Tariff Rate Quota NIC National Informatics Centre UAEGD UAE Good Delivery NICCL NSE IFSC Clearing Corporation Limited UK United Kingdom NIFTY National Stock Exchange Fifty UNDP United Nations Development Program NSCS National Security Council Secretariat USD United States Dollar NSDL National Securities Depository Limited WPI Wholesale Price Index NSE National Stock Exchange YoY Year on Year NSE IX NSE International Exchange2023-24 In the beginning of the year 2024, expectations about policy wavered greatly, oscillating between THE YEAR IN REVIEW periods of optimism and pessimism. The economic conditions continued to improve as the investors around the globe were expecting looser policy, and the credit spreads also narrowed as Global Economy Assessment and Outlook there was a lower perception of risk.⁷ However, the monetary stance tightened in various economies, in anticipation of inflationary pressures. ⁸ The period following the year 2022 was characterized by significant changes in the global trading pattern due to intense geo-economic fragmentation and rising trade tensions. Supply shocks were There was a notable shift in cross-border financial activity during this period. The cross-border felt across the globe as disturbances were experienced across all major trade routes including claims fell by USD 377 Bn in the fourth quarter of 2023, which is considerably less than the fall of Black Sea, Red Sea and Panama Canal.¹ These events led to a grim outlook for the economy and to USD 1.4 trillion registered in the fourth quarter of 2022. The outstanding value of cross-border anticipation of a global recession. financial activity as of December 2023 was USD 39 trillion.⁹ Central banks around the globe adopted a tight monetary stance to restore price stability but the Credit to the non-bank sector rose by USD 247 Bn in the fourth quarter of 2023 marking a major rate of monetary transmission² varied among countries; the long-term monetary actions were uptick from the previous year. Credit offered to non-banking financial institutions however successful in controlling the inflation expectations in the emerging economies, but the monetary displayed a mixed trend. The first three quarters of 2023 marked an uptick of USD 600 Bn but fell transmission was not as rapid in developed countries.³ by USD 16 Bn during the fourth quarter. Despite the decline in cross-border claims, cross-border credit increased by USD 319 Bn this year. Despite all disturbances and challenges, the global economy grew steadily, showing extreme resilience. During 2022 and 2023, global real GDP rose by a cumulative 6.7 per cent⁴ and there was Moreover, credit to emerging market and developing economies (EMDEs) increased by USD 30 Bn no inflation spiral as anticipated. In fact, as a welcome change, ever since the global inflation surge in the fourth quarter of 2023 as opposed to a fall of USD 179 Bn which was recorded in the previous started, the headline inflation was at par with the pre-pandemic period for many economies year (Q4 2022). This increase signals continued investor interest or confidence in these towards the end of 2023. economies, despite the fluctuations. It is estimated that the global economy will continue growing at 3.2 per cent in 2024 and 2025. For The top 10 Global banks in the world had a total market capitalisation value of USD 1,879,696 Mn, advanced economies, the growth is projected to rise gradually, from 1.6 per cent in 2023 to 1.7 per of which the top 2 banks, i.e., JPMorgan Chase & Co and Commercial Bank of China Ltd. Accounted cent in 2024 and 1.8 per cent in 2025; whereas in emerging market and developing economies, for 20% and 12.5%, respectively. ¹⁰ growth is expected to be comparatively higher at 4.2 per cent in 2024 and 2025.⁵ The global headline inflation is expected to fall from an annual average of 6.8 per cent in 2023 to 5.9 Capital Markets per cent in 2024 and further down to 4.5 per cent in 2025. The actions of central banks around the world to control inflationary pressures arising from the Thus, key decision makers are now faced with the complex challenge of navigating through a global events that unfolded, in turn, created pressure on share prices around the world. The most paradoxical world economy which is on one hand still recovering from multiple shocks and on the conspicuous effects include a decrease in the number of IPOs and in investment flows globally, other, trying to find footing in a scenario of extreme interdependence accompanied by political which fell by 27% and 53.4%, respectively in comparison to their 2022 levels. Only a few markets, fragmentation further obscured by the impending threat of climate change. A synchronised series like the U.S., offered a positive trend. Similarly, trading activity in the cash equities decreased across of joint efforts and continuous and active co-operation is the need of the hour. regions. On similar lines, the global value and volume of shares traded decreased by 20.9% and 13.9%, respectively; such decline was observed across all regions.¹¹ Financial Markets Performance By contrast, there was an increase in volume of commodity derivatives because of frenzied steps taken to manage risks in response to consistent rate hikes and geopolitical tensions.¹² Banking Industry Banking industry around the globe was impacted adversely by the atmosphere of investor distrust arising from the Silicon Valley Bank crisis and other disturbances.⁶ ¹ Unprecedented shipping disruptions raise risk to global trade, UNCTAD warns”, Feb 2024, UNCTAD ⁷ Quarterly Review, March 2024, BIS ² The process through which monetary policy decisions affect the economy in general and the price level in particular (ECB) ⁸ ibid ³ World Economic Outlook, April 2024, IMF ⁹ International banking statistics and global liquidity indicators, December 2023, BIS ⁴ ibid ¹⁰ 'Top 10 Banks’, 2023, Global Data ⁵ ibid ¹¹ Market Highlights, 2023, World Federation of Exchanges ⁶ Global Financial Stability Notes, March 2024, IMF ¹² ibid 02 032023-24 In the beginning of the year 2024, expectations about policy wavered greatly, oscillating between THE YEAR IN REVIEW periods of optimism and pessimism. The economic conditions continued to improve as the investors around the globe were expecting looser policy, and the credit spreads also narrowed as Global Economy Assessment and Outlook there was a lower perception of risk.⁷ However, the monetary stance tightened in various economies, in anticipation of inflationary pressures. ⁸ The period following the year 2022 was characterized by significant changes in the global trading pattern due to intense geo-economic fragmentation and rising trade tensions. Supply shocks were There was a notable shift in cross-border financial activity during this period. The cross-border felt across the globe as disturbances were experienced across all major trade routes including claims fell by USD 377 Bn in the fourth quarter of 2023, which is considerably less than the fall of Black Sea, Red Sea and Panama Canal.¹ These events led to a grim outlook for the economy and to USD 1.4 trillion registered in the fourth quarter of 2022. The outstanding value of cross-border anticipation of a global recession. financial activity as of December 2023 was USD 39 trillion.⁹ Central banks around the globe adopted a tight monetary stance to restore price stability but the Credit to the non-bank sector rose by USD 247 Bn in the fourth quarter of 2023 marking a major rate of monetary transmission² varied among countries; the long-term monetary actions were uptick from the previous year. Credit offered to non-banking financial institutions however successful in controlling the inflation expectations in the emerging economies, but the monetary displayed a mixed trend. The first three quarters of 2023 marked an uptick of USD 600 Bn but fell transmission was not as rapid in developed countries.³ by USD 16 Bn during the fourth quarter. Despite the decline in cross-border claims, cross-border credit increased by USD 319 Bn this year. Despite all disturbances and challenges, the global economy grew steadily, showing extreme resilience. During 2022 and 2023, global real GDP rose by a cumulative 6.7 per cent⁴ and there was Moreover, credit to emerging market and developing economies (EMDEs) increased by USD 30 Bn no inflation spiral as anticipated. In fact, as a welcome change, ever since the global inflation surge in the fourth quarter of 2023 as opposed to a fall of USD 179 Bn which was recorded in the previous started, the headline inflation was at par with the pre-pandemic period for many economies year (Q4 2022). This increase signals continued investor interest or confidence in these towards the end of 2023. economies, despite the fluctuations. It is estimated that the global economy will continue growing at 3.2 per cent in 2024 and 2025. For The top 10 Global banks in the world had a total market capitalisation value of USD 1,879,696 Mn, advanced economies, the growth is projected to rise gradually, from 1.6 per cent in 2023 to 1.7 per of which the top 2 banks, i.e., JPMorgan Chase & Co and Commercial Bank of China Ltd. Accounted cent in 2024 and 1.8 per cent in 2025; whereas in emerging market and developing economies, for 20% and 12.5%, respectively. ¹⁰ growth is expected to be comparatively higher at 4.2 per cent in 2024 and 2025.⁵ The global headline inflation is expected to fall from an annual average of 6.8 per cent in 2023 to 5.9 Capital Markets per cent in 2024 and further down to 4.5 per cent in 2025. The actions of central banks around the world to control inflationary pressures arising from the Thus, key decision makers are now faced with the complex challenge of navigating through a global events that unfolded, in turn, created pressure on share prices around the world. The most paradoxical world economy which is on one hand still recovering from multiple shocks and on the conspicuous effects include a decrease in the number of IPOs and in investment flows globally, other, trying to find footing in a scenario of extreme interdependence accompanied by political which fell by 27% and 53.4%, respectively in comparison to their 2022 levels. Only a few markets, fragmentation further obscured by the impending threat of climate change. A synchronised series like the U.S., offered a positive trend. Similarly, trading activity in the cash equities decreased across of joint efforts and continuous and active co-operation is the need of the hour. regions. On similar lines, the global value and volume of shares traded decreased by 20.9% and 13.9%, respectively; such decline was observed across all regions.¹¹ Financial Markets Performance By contrast, there was an increase in volume of commodity derivatives because of frenzied steps taken to manage risks in response to consistent rate hikes and geopolitical tensions.¹² Banking Industry Banking industry around the globe was impacted adversely by the atmosphere of investor distrust arising from the Silicon Valley Bank crisis and other disturbances.⁶ ¹ Unprecedented shipping disruptions raise risk to global trade, UNCTAD warns”, Feb 2024, UNCTAD ⁷ Quarterly Review, March 2024, BIS ² The process through which monetary policy decisions affect the economy in general and the price level in particular (ECB) ⁸ ibid ³ World Economic Outlook, April 2024, IMF ⁹ International banking statistics and global liquidity indicators, December 2023, BIS ⁴ ibid ¹⁰ 'Top 10 Banks’, 2023, Global Data ⁵ ibid ¹¹ Market Highlights, 2023, World Federation of Exchanges ⁶ Global Financial Stability Notes, March 2024, IMF ¹² ibid 02 032023-24 Funds Industry The gross re-insurance premiums increased by almost 10% by the end of 2022. The Gross Written Premium for the global insurance market including re-insurance on the other hand saw a slight The global asset management industry's assets rose to nearly USD 120 trillion in 2023, reverting decrease of 0.3% in 2023.¹⁸ from a decline the year before. However, asset managers faced a variety of challenges to their The global gross reinsurance market size amounted to USD 809 Bn with 46% located in America. growth.¹³ Market performance has been the major factor driving the industry's revenue growth for The net value on the other hand was USD 570 Bn.¹⁹ nearly two decades. However, in 2022, rapidly rising interest rates caused both stock and bond values to plummet. Global Assets under Management (AUM) fell by USD 10 trillion to USD 98 There were few changes in the allocation of reinsurer's assets including minor increase to the trillion–near 2020 levels. The net flow rate of assets also fell below 3% for the first time since 2018, equity component and loans and a decrease in the holdings of corporate and sovereign debt and an reaching 1.6% of total AUM at the beginning of 2022.¹⁴ uptick was observed in the use of asset intensive reinsurance in the life-insurance sector ever since the pandemic, due to persistently lower rates and evolving regulatory frameworks in the period A transformative mindset of Fund Managers, focusing on profitability, private markets, and after. Bermuda, USA, Germany, Switzerland, and UK emerged to be the five largest reinsurance personalization to navigate the economic uncertainty and meet investor demands, is the primary markets in terms of gross premiums.²⁰ need of the moment. New technologies, notably direct indexing, are effectively democratizing the ability to personalize products for the end investor. Bullion Alternative Investments represented more than USD 20 trillion of global AUM as of year 2022. These products also accounted for half of the industry's global revenues, generating more than As a result of the high level of geopolitical risks, a fall in global demand for gold was observed. USD190 Bn in revenues for the firms that offer them. This strong momentum is expected to prevail Demand for gold is comprised of four major components i.e jewellery, technology, investment and with a CAGR of 7% in alternative assets over next few years.¹⁵ demand generated by central banks. The total demand for gold fell by 5% to 4467.9 tonnes in 2023 in comparison to 4699.4 tonnes in Insurance Industry 2022. Jewellery demand, which is the biggest component of total gold demand was recorded at 2192.2 tonnes in 2023 which is slightly less than 2195.9 tonnes in the previous year. In the insurance industry, both life and non-life businesses are expected to improve. In the non-life sector, the return on equity (ROE) is expected to rise to 9.3% in 2024 owing to strengthening Second biggest component of the overall demand was Investment comprising bars, coins, ETFs investment return, whereas in the life sector the premiums are expected to rise by 1.5% in 2024, and similar products. This stood at 1112.8 tonnes registering a 15 % decline from 940.7 tonnes in above the 10-year trend of 1.3%. 2022. Demand generated by central banks also decreased during this period, falling to 1081.9 tonnes in 2023.²¹ US remains at the top of the global insurance industry with premiums close to USD 3 trillion in 2022 and a global share market of 44%. China stands second with premium volume of USD 698 Bn, The world silver market went through a period of deficit, wherein the overall demand for silver followed by the UK who replaced Japan in the third position, with a premium volume of USD 363 heavily exceeded the supply. Silver demand was primarily driven by use of silver in industrial Bn. India has notably increased its global share and is on course to be the sixth largest market in the applications and in jewellery making. The usage in green technologies like solar power equipment world by 2032. The global insurance premium volumes (non-life and life) are projected to grow by witnessed a rise due to the recent climate transition movement that is being adopted by multiple 1.1% in 2023 and by 1.7% in 2024 in real terms (both below the 10-year trend of 2.6%), after a countries worldwide and this demand is further anticipated to rise by 9% in 2024, as transition to 1.1% decline in 2022. It is also expected that for non-life, premium growth will rise to 1.4% in real cleaner energies becomes more rapid. terms after a gain of just 0.5% in 2022.¹⁶ The total supply of silver primarily depends on the mining production levels and the overall Markets worldwide have displayed a sense of distrust as a response to multiple shocks that were recycling levels. The mining levels around the globe fell by 1% in 2023 compared to the previous faced during this period. Re-generating trust in such a scenario may be a challenge for the year.²² The recycling levels were also muted in the year and are expected to fall further down in insurance industry. Introducing highest standards for transparency and accountability and 2024.²³ Despite 11% growth in Industrial demand, silver jewellery fabrication fell by 13% in technological adaptability along with strict regulation are thus crucial at this juncture. ¹⁷ 2023-24, especially in India, leading to a drop in demand by 7%. These factors lead to reduced supply of silver in the market. ¹³ AI and the next wave of Transformation, 2024, BCG ¹⁸ Global Insurance Market Report, 2023, IAIS ¹⁴ The Tide has turned, 2023, BCG ¹⁹ Figures are representative of the sample of respondents included in the IAIS' survey 2023 ¹⁵ ibid ²⁰ Global Insurance Market Report, 2023, IAIS ¹⁶ Sigma Report, 2023, Swiss Re ²¹ Gold Outlook, 2024, World Gold Council ¹⁷ ibid ²² World Silver Survey, 2024, The Silver Institute ²³ ibid 04 052023-24 Funds Industry The gross re-insurance premiums increased by almost 10% by the end of 2022. The Gross Written Premium for the global insurance market including re-insurance on the other hand saw a slight The global asset management industry's assets rose to nearly USD 120 trillion in 2023, reverting decrease of 0.3% in 2023.¹⁸ from a decline the year before. However, asset managers faced a variety of challenges to their The global gross reinsurance market size amounted to USD 809 Bn with 46% located in America. growth.¹³ Market performance has been the major factor driving the industry's revenue growth for The net value on the other hand was USD 570 Bn.¹⁹ nearly two decades. However, in 2022, rapidly rising interest rates caused both stock and bond values to plummet. Global Assets under Management (AUM) fell by USD 10 trillion to USD 98 There were few changes in the allocation of reinsurer's assets including minor increase to the trillion–near 2020 levels. The net flow rate of assets also fell below 3% for the first time since 2018, equity component and loans and a decrease in the holdings of corporate and sovereign debt and an reaching 1.6% of total AUM at the beginning of 2022.¹⁴ uptick was observed in the use of asset intensive reinsurance in the life-insurance sector ever since the pandemic, due to persistently lower rates and evolving regulatory frameworks in the period A transformative mindset of Fund Managers, focusing on profitability, private markets, and after. Bermuda, USA, Germany, Switzerland, and UK emerged to be the five largest reinsurance personalization to navigate the economic uncertainty and meet investor demands, is the primary markets in terms of gross premiums.²⁰ need of the moment. New technologies, notably direct indexing, are effectively democratizing the ability to personalize products for the end investor. Bullion Alternative Investments represented more than USD 20 trillion of global AUM as of year 2022. These products also accounted for half of the industry's global revenues, generating more than As a result of the high level of geopolitical risks, a fall in global demand for gold was observed. USD190 Bn in revenues for the firms that offer them. This strong momentum is expected to prevail Demand for gold is comprised of four major components i.e jewellery, technology, investment and with a CAGR of 7% in alternative assets over next few years.¹⁵ demand generated by central banks. The total demand for gold fell by 5% to 4467.9 tonnes in 2023 in comparison to 4699.4 tonnes in Insurance Industry 2022. Jewellery demand, which is the biggest component of total gold demand was recorded at 2192.2 tonnes in 2023 which is slightly less than 2195.9 tonnes in the previous year. In the insurance industry, both life and non-life businesses are expected to improve. In the non-life sector, the return on equity (ROE) is expected to rise to 9.3% in 2024 owing to strengthening Second biggest component of the overall demand was Investment comprising bars, coins, ETFs investment return, whereas in the life sector the premiums are expected to rise by 1.5% in 2024, and similar products. This stood at 1112.8 tonnes registering a 15 % decline from 940.7 tonnes in above the 10-year trend of 1.3%. 2022. Demand generated by central banks also decreased during this period, falling to 1081.9 tonnes in 2023.²¹ US remains at the top of the global insurance industry with premiums close to USD 3 trillion in 2022 and a global share market of 44%. China stands second with premium volume of USD 698 Bn, The world silver market went through a period of deficit, wherein the overall demand for silver followed by the UK who replaced Japan in the third position, with a premium volume of USD 363 heavily exceeded the supply. Silver demand was primarily driven by use of silver in industrial Bn. India has notably increased its global share and is on course to be the sixth largest market in the applications and in jewellery making. The usage in green technologies like solar power equipment world by 2032. The global insurance premium volumes (non-life and life) are projected to grow by witnessed a rise due to the recent climate transition movement that is being adopted by multiple 1.1% in 2023 and by 1.7% in 2024 in real terms (both below the 10-year trend of 2.6%), after a countries worldwide and this demand is further anticipated to rise by 9% in 2024, as transition to 1.1% decline in 2022. It is also expected that for non-life, premium growth will rise to 1.4% in real cleaner energies becomes more rapid. terms after a gain of just 0.5% in 2022.¹⁶ The total supply of silver primarily depends on the mining production levels and the overall Markets worldwide have displayed a sense of distrust as a response to multiple shocks that were recycling levels. The mining levels around the globe fell by 1% in 2023 compared to the previous faced during this period. Re-generating trust in such a scenario may be a challenge for the year.²² The recycling levels were also muted in the year and are expected to fall further down in insurance industry. Introducing highest standards for transparency and accountability and 2024.²³ Despite 11% growth in Industrial demand, silver jewellery fabrication fell by 13% in technological adaptability along with strict regulation are thus crucial at this juncture. ¹⁷ 2023-24, especially in India, leading to a drop in demand by 7%. These factors lead to reduced supply of silver in the market. ¹³ AI and the next wave of Transformation, 2024, BCG ¹⁸ Global Insurance Market Report, 2023, IAIS ¹⁴ The Tide has turned, 2023, BCG ¹⁹ Figures are representative of the sample of respondents included in the IAIS' survey 2023 ¹⁵ ibid ²⁰ Global Insurance Market Report, 2023, IAIS ¹⁶ Sigma Report, 2023, Swiss Re ²¹ Gold Outlook, 2024, World Gold Council ¹⁷ ibid ²² World Silver Survey, 2024, The Silver Institute ²³ ibid 04 052023-24 India: Economic Assessment and Prospects inflation level, however, fell from 4.85% in the previous year to 4.11%.³² The annual rate of inflation based on all India Wholesale Price Index (WPI) rose to 2.61 % for the month of May 2024 Gross Domestic Product over May 2023.³³ The Indian economy exhibited resilience during FY 2023-24, notwithstanding persistent Food inflation increased amidst high volatility. Prices of cereals, pulses, spices, and vegetables headwinds from subdued external demand, protracted geopolitical tensions and volatile global continued to rise due to overlapping and continuous supply shocks, pushing food inflation up to financial markets. The growth in real Gross Domestic Product (GDP) during 2023-24 is estimated 7.0% in 2023-24 from 6.7% a year ago.³⁴ at 7.6 per cent as compared to 7.0 per cent in 2022-23²⁴, supported by robust growth in fixed Inflation is estimated to decline gradually in 2024 and 2025.³⁵ It is expected to decline to 5.4 per investment on the back of the government's focus on capital expenditure. On the supply side, economic activity was lifted by the boost to the manufacturing sector's profitability from the cent in FY 2023-24 from 6.7 per cent in FY 2022-23 and further down to 4.5% in FY 2025.³⁶ Core correction in input prices and sustained momentum in services activity, even as the agricultural inflation is also projected to fall to 4.7 per cent in FY 2023-24 from 6.1 per cent in the previous year sector activity exhibited a slowdown.²⁵ and gradually to 4 per cent over the medium term.³⁷ The Asian Development Bank (ADB) projects growth in India's GDP to rise to 6.7% in FY2024-25, Financial Markets driven by private consumption and private investment on the back of government policies to improve transport infrastructure, logistics, and the business ecosystem.²⁶ FY 2024-25 is expected Banking Sector to see faster growth in investment, based on supportive government policies and sound The overall health of the banking sector remained robust backed by strong balance sheets, buffers macroeconomic fundamentals, lower non-performing loans in banks, and significant corporate and high rate of monetary transmission. deleveraging that will enhance bank lending.²⁷ The effects of monetary policy decisions of 2022-23 continued in 2023- 24 as well. There was a Prominent international organisations also concur with these growth expectations. The moderation in surplus liquidity in the Indian banking system during the period and the credit International Monetary Fund (IMF) has categorised India amongst the developing countries that growth consistently outpaced deposit growth. There was also an increase in the share of external are most rapidly integrating into the global economy through trade, it estimates India to undergo a benchmark-linked loans compared to loans linked to the Marginal Cost of Funds-based Lending growth of 6.8% in FY 24 and 6.5% in FY 25 owing to its rising working population and demand.²⁸ Rate (MCLR). The expansion of currency in circulation slowed down. Additionally, deposit growth The ADB foresees robust public and private sector investment demand and a gradual improvement accelerated, partly due to the reintroduction of ₹ 2000 bank notes into the banking system which in consumer demand due to the improvement of the rural economy in India. As a result, India is were withdrawn from circulation in May 2023. The return of these notes to banks mostly took the estimated to grow by 7.0% in FY 24 and by 7.2%²⁹ ⁱⁿ ²⁵. form of deposits, boosting the overall deposit base in the banking system.³⁸ The World Bank attributes resilient growth in India to strong domestic demand, expanding fixed Bank credit growth remained robust throughout 2023-24, driven primarily by demand from the investment amid rising public infrastructure spending and strong private-sector credit growth, it retail and services sectors. Scheduled Commercial Banks (SCBs) experienced a credit expansion of has estimated a growth of 6.3 per cent in FY 2023-24 followed by a gradual increase to 6.4 per cent 16.3% as of March 22, 2024, compared to a growth of 15% the previous year.³⁹ in FY2024-25 and finally to 6.5 per cent in FY 2025-26.³⁰ The asset quality of Indian banks improved, with the Gross Non-Performing Assets (GNPA) ratio Inflation declining to its lowest in a decade. The GNPA ratio went to a record low value of 3.2% in 2023. The Net Non-Performing Assets also fell to 0.8%.The capital adequacy ratio of Indian banks remained Inflation rate in India slowed down in 2023-24, dropping to 5.4% from 6.7% in the previous year. robust, indicating a sound capital position that can withstand potential stress scenarios.⁴⁰ This was largely driven by a decrease in core inflation from 6.1% to 4.3%. Fuel inflation also decreased significantly as a result of fall in domestic prices for Liquefied Petroleum Gas (LPG) and There was an observable shift in the composition of bank credit with a higher portion attributable kerosene. This was majorly impacted by the corrections in global energy prices.³¹ to the Services and Retail sectors. Retail loans comprised 42.2% of total gross advances of the banks. The CRAR ratio of SCBs stood at 15.9 per cent in December 2023. The provision coverage The year-on-year inflation rates (%) based on CPI were higher for the urban and rural sector ratio increased to 75.3 per cent.⁴¹ compared to the previous year. The combined level was 4.83% as opposed to 4.7% last year which can be attributed to the rural level, which rose to 5.43% as opposed to 4.68% last year. The urban ³² 'CPI numbers', May 2024, MoSPI ³³ 'Index Numbers of Wholesale Price in India', April 2024, Office of Economic Adviser. ²⁴ Second Advanced Estimates, 2024, NSO, MoSPI ³⁴ Annual report, 2023-24, RBI ²⁵ Annual report, 2023-24, RBI ³⁵ World Economic Outlook, April 2024, IMF ²⁶ Asian Development Outlook, April 2023 ³⁶ ADB Forecast ²⁷ ibid ³⁷ IMF Consultation ²⁸ World Economic Outlook, April 2024, IMF ³⁸ Annual report, 2023-24, RBI ²⁹ Economic Forecast for India, 2024, ADB ³⁹ ibid ³⁰ Global Economic Prospects, 2024, World Bank ⁴⁰ Trends and Progress of Banking in India, 2023, RBI ³¹ Annual report, 2023-24, RBI ⁴¹ Financial Stability Report, Dec 2023, RBI 06 072023-24 India: Economic Assessment and Prospects inflation level, however, fell from 4.85% in the previous year to 4.11%.³² The annual rate of inflation based on all India Wholesale Price Index (WPI) rose to 2.61 % for the month of May 2024 Gross Domestic Product over May 2023.³³ The Indian economy exhibited resilience during FY 2023-24, notwithstanding persistent Food inflation increased amidst high volatility. Prices of cereals, pulses, spices, and vegetables headwinds from subdued external demand, protracted geopolitical tensions and volatile global continued to rise due to overlapping and continuous supply shocks, pushing food inflation up to financial markets. The growth in real Gross Domestic Product (GDP) during 2023-24 is estimated 7.0% in 2023-24 from 6.7% a year ago.³⁴ at 7.6 per cent as compared to 7.0 per cent in 2022-23²⁴, supported by robust growth in fixed Inflation is estimated to decline gradually in 2024 and 2025.³⁵ It is expected to decline to 5.4 per investment on the back of the government's focus on capital expenditure. On the supply side, economic activity was lifted by the boost to the manufacturing sector's profitability from the cent in FY 2023-24 from 6.7 per cent in FY 2022-23 and further down to 4.5% in FY 2025.³⁶ Core correction in input prices and sustained momentum in services activity, even as the agricultural inflation is also projected to fall to 4.7 per cent in FY 2023-24 from 6.1 per cent in the previous year sector activity exhibited a slowdown.²⁵ and gradually to 4 per cent over the medium term.³⁷ The Asian Development Bank (ADB) projects growth in India's GDP to rise to 6.7% in FY2024-25, Financial Markets driven by private consumption and private investment on the back of government policies to improve transport infrastructure, logistics, and the business ecosystem.²⁶ FY 2024-25 is expected Banking Sector to see faster growth in investment, based on supportive government policies and sound The overall health of the banking sector remained robust backed by strong balance sheets, buffers macroeconomic fundamentals, lower non-performing loans in banks, and significant corporate and high rate of monetary transmission. deleveraging that will enhance bank lending.²⁷ The effects of monetary policy decisions of 2022-23 continued in 2023- 24 as well. There was a Prominent international organisations also concur with these growth expectations. The moderation in surplus liquidity in the Indian banking system during the period and the credit International Monetary Fund (IMF) has categorised India amongst the developing countries that growth consistently outpaced deposit growth. There was also an increase in the share of external are most rapidly integrating into the global economy through trade, it estimates India to undergo a benchmark-linked loans compared to loans linked to the Marginal Cost of Funds-based Lending growth of 6.8% in FY 24 and 6.5% in FY 25 owing to its rising working population and demand.²⁸ Rate (MCLR). The expansion of currency in circulation slowed down. Additionally, deposit growth The ADB foresees robust public and private sector investment demand and a gradual improvement accelerated, partly due to the reintroduction of ₹ 2000 bank notes into the banking system which in consumer demand due to the improvement of the rural economy in India. As a result, India is were withdrawn from circulation in May 2023. The return of these notes to banks mostly took the estimated to grow by 7.0% in FY 24 and by 7.2%²⁹ ⁱⁿ ²⁵. form of deposits, boosting the overall deposit base in the banking system.³⁸ The World Bank attributes resilient growth in India to strong domestic demand, expanding fixed Bank credit growth remained robust throughout 2023-24, driven primarily by demand from the investment amid rising public infrastructure spending and strong private-sector credit growth, it retail and services sectors. Scheduled Commercial Banks (SCBs) experienced a credit expansion of has estimated a growth of 6.3 per cent in FY 2023-24 followed by a gradual increase to 6.4 per cent 16.3% as of March 22, 2024, compared to a growth of 15% the previous year.³⁹ in FY2024-25 and finally to 6.5 per cent in FY 2025-26.³⁰ The asset quality of Indian banks improved, with the Gross Non-Performing Assets (GNPA) ratio Inflation declining to its lowest in a decade. The GNPA ratio went to a record low value of 3.2% in 2023. The Net Non-Performing Assets also fell to 0.8%.The capital adequacy ratio of Indian banks remained Inflation rate in India slowed down in 2023-24, dropping to 5.4% from 6.7% in the previous year. robust, indicating a sound capital position that can withstand potential stress scenarios.⁴⁰ This was largely driven by a decrease in core inflation from 6.1% to 4.3%. Fuel inflation also decreased significantly as a result of fall in domestic prices for Liquefied Petroleum Gas (LPG) and There was an observable shift in the composition of bank credit with a higher portion attributable kerosene. This was majorly impacted by the corrections in global energy prices.³¹ to the Services and Retail sectors. Retail loans comprised 42.2% of total gross advances of the banks. The CRAR ratio of SCBs stood at 15.9 per cent in December 2023. The provision coverage The year-on-year inflation rates (%) based on CPI were higher for the urban and rural sector ratio increased to 75.3 per cent.⁴¹ compared to the previous year. The combined level was 4.83% as opposed to 4.7% last year which can be attributed to the rural level, which rose to 5.43% as opposed to 4.68% last year. The urban ³² 'CPI numbers', May 2024, MoSPI ³³ 'Index Numbers of Wholesale Price in India', April 2024, Office of Economic Adviser. ²⁴ Second Advanced Estimates, 2024, NSO, MoSPI ³⁴ Annual report, 2023-24, RBI ²⁵ Annual report, 2023-24, RBI ³⁵ World Economic Outlook, April 2024, IMF ²⁶ Asian Development Outlook, April 2023 ³⁶ ADB Forecast ²⁷ ibid ³⁷ IMF Consultation ²⁸ World Economic Outlook, April 2024, IMF ³⁸ Annual report, 2023-24, RBI ²⁹ Economic Forecast for India, 2024, ADB ³⁹ ibid ³⁰ Global Economic Prospects, 2024, World Bank ⁴⁰ Trends and Progress of Banking in India, 2023, RBI ³¹ Annual report, 2023-24, RBI ⁴¹ Financial Stability Report, Dec 2023, RBI 06 072023-24 Insurance and Re-Insurance Sector the non-financial sector amounting to ₹ 60,327 crores⁴⁹. The Offer for Sale (OFS) component In India, the life insurance market contributes the most to the overall insurance penetration level. comprised ₹ 30,482 crores and Fresh capital raising component comprised ₹ 29,852 crores in the This is observable in the fact that the overall insurance penetration level in FY 2022-23 was 4% non-financial sector in FY 2023-24.⁵⁰ wherein, life insurance accounted for 3% of it and general insurance for the remaining 1%. An Mutual funds have displayed remarkable growth in the last decade, the value of total gross Increase in the overall insurance penetration level in India can be achieved by significantly mobilization by value way of Mutual Funds rose to ₹ 114.48 lakh crores in 2023-24 from the increasing the accessibility to the informal sector. ⁴² previous value of ₹ 105.07 lakh crores in 2022-23.⁵¹ The contribution by the private sector As far as non-life sector is concerned, a positive trend was noticed in the health and motor sectors amounted to ₹ 88.4 lakh crores and that by the public sector amounted to ₹ 26.06 lakh crores. In during this period. In the non-life insurance segment, the YoY growth in gross direct premium the last decade, the AUM of Mutual Fund industry grew to a value of ₹ 39.4 lakh crores as on March (within and outside India) stood at ₹ 2,60,327.82 crore with Health and Motor sectors being the 2023 and reported a CAGR of 19% for the decade 2013-2023.⁵² This reflects increased investor key drivers. Net incurred claims of Non-Life Insurers stood at 82.95%.⁴³ confidence and a strong regulatory framework. In the Life insurance segment, the total premium during FY 2022-23 increased by 12.98% Total number of public and rights issues (Equity + Debt) increased to 385 amounting to ₹ 1.02 lakh compared to the FY 2021-22.⁴⁴ of the total premium in the life insurance segment ₹ 3,71,225.82 crores in 2023-24 from previous value of 272 amounting to ₹ 75,036 crores in 2022-23. There was crore was received from new business. Benefit pay-outs in the life insurance sector during FY a total of 17 issues amounting to the volume of ₹ 39,024 crores mobilized by REITs & InvITs in the 2022-23 was ₹ 4,96,865.13 crore with 10% benefits paid out on death claims.⁴⁵ Non- Financial Sector in the year 2023-24.⁵³ The overall insurance density in India was USD 92 in FY 2022-23, wherein, Life segment Mutual Funds comprised 7.8% share in turnover of Cash segment of NSE in 2023-24 which is contributed USD 70 and General comprising USD 22 which is only a mild uptick from the USD 91 slightly below the 2022-23 share of 8%, similarly FPIs contributed 14.4 % in 2023-24 as opposed from FY 2021-22.⁴⁶ to 14.5% in 2022-23.⁵⁴ India, with an estimated market share of 1.9% of Global market in 2022-23, is on the course to Funds Industry become the sixth largest market in the world by 2032.⁴⁷ Reinsurance premium placed within India formed 17% of the total non-life gross domestic The Indian asset management sector has grown substantially, becoming a popular choice for premium booked in 2022-23, this was slightly less than the 22% in the previous year. The wealth creation, on account of increased financial awareness, regulatory strength, and FinTech premiums booked by General Insurance Company (Global Re-insurance solutions) and Foreign advancements. There has been a rise in systematic and passive investments, as well as ESG- Re-insurance Branches amounted to ₹ 54,678 crores in 2022-23 which is considerably less than focused investing, contributing to the landscape of Mutual Fund Industry. AIFs have also the previous year level of ₹ 61,337 crores.⁴⁸ expanded, benefiting from India's economic growth and a wealthier investor demographic. REITs and InvITs are new funding avenues that could significantly boost India's economic growth. In 2021-22, re-insurance premium placed within India through General Insurance Company (Global Re-insurance solutions) and Foreign Re-insurance Branches formed 62% of the Total The FY 2023-24 turned out to be one of the best periods for the Indian mutual fund industry as the reinsurance business of India whereas the re-insurance premium placed with Cross-Border re- AUM grew by nearly ₹ 14 lakh crores to a record ₹ 53.40 lakh crores as of March 2024 compared insurers only formed 38% of the total business. In 2022-23, however, these percentages have with ₹ 39.42 lakh crores as of March 2023.⁵⁵ This growth has been mainly driven by growing changed to 54% and 46% respectively denoting a considerable rise in the reinsurance placed participation of individual investors, buoyant equity markets and evolving investment strategies. through cross-border reinsurers. Equity was the primary asset class with mutual funds allocating 22.45 trillion Indian rupees, followed by debt with nearly 17 trillion Indian rupees deployed.⁵⁶ Capital Markets India's AIF industry reported a robust annual growth of 30%, with AUM increasing to ₹ 8.34 lakh There was strong resource mobilisation in Indian capital markets across sectors and instruments. crores from ₹ 6.41 lakh crores in the previous year. Category II funds accounted for the largest This was instrumental in the rapid recovery that Indian economy underwent. share with ₹ 6.94 lakh crores, marking a 34% increase from last year. The total AUM has nearly tripled over the past five years, reaching approximately USD 101 Bn in FY 2023. There were 12 IPOs in the financial sector during the year amounting to ₹ 7,628 crores and 260 in ⁴² Sigma Report, 2023, Swiss Re ⁴⁹ Current Statistics- Bulletin (Annexure Tables), April 2024, SEBI ⁴³ Handbook of Statistics, 2022-23, IRDAI ⁵⁰ ibid ⁴⁴ ibid ⁵¹ Monthly Bulletin, May 2024, SEBI ⁴⁵ ibid ⁵² Annual Report, 2022-23, SEBI ⁴⁶ Handbook of Statistics, 2022-23, IRDAI ⁵³ ibid ⁴⁷ Sigma Report, 2023, Swiss Re ⁵⁴ ibid ⁴⁸ IRDAI ⁵⁵ Annual Report, Feb 2024, AMFI ⁵⁶ Monthly Bulletin, May 2024, SEBI 08 092023-24 Insurance and Re-Insurance Sector the non-financial sector amounting to ₹ 60,327 crores⁴⁹. The Offer for Sale (OFS) component In India, the life insurance market contributes the most to the overall insurance penetration level. comprised ₹ 30,482 crores and Fresh capital raising component comprised ₹ 29,852 crores in the This is observable in the fact that the overall insurance penetration level in FY 2022-23 was 4% non-financial sector in FY 2023-24.⁵⁰ wherein, life insurance accounted for 3% of it and general insurance for the remaining 1%. An Mutual funds have displayed remarkable growth in the last decade, the value of total gross Increase in the overall insurance penetration level in India can be achieved by significantly mobilization by value way of Mutual Funds rose to ₹ 114.48 lakh crores in 2023-24 from the increasing the accessibility to the informal sector. ⁴² previous value of ₹ 105.07 lakh crores in 2022-23.⁵¹ The contribution by the private sector As far as non-life sector is concerned, a positive trend was noticed in the health and motor sectors amounted to ₹ 88.4 lakh crores and that by the public sector amounted to ₹ 26.06 lakh crores. In during this period. In the non-life insurance segment, the YoY growth in gross direct premium the last decade, the AUM of Mutual Fund industry grew to a value of ₹ 39.4 lakh crores as on March (within and outside India) stood at ₹ 2,60,327.82 crore with Health and Motor sectors being the 2023 and reported a CAGR of 19% for the decade 2013-2023.⁵² This reflects increased investor key drivers. Net incurred claims of Non-Life Insurers stood at 82.95%.⁴³ confidence and a strong regulatory framework. In the Life insurance segment, the total premium during FY 2022-23 increased by 12.98% Total number of public and rights issues (Equity + Debt) increased to 385 amounting to ₹ 1.02 lakh compared to the FY 2021-22.⁴⁴ of the total premium in the life insurance segment ₹ 3,71,225.82 crores in 2023-24 from previous value of 272 amounting to ₹ 75,036 crores in 2022-23. There was crore was received from new business. Benefit pay-outs in the life insurance sector during FY a total of 17 issues amounting to the volume of ₹ 39,024 crores mobilized by REITs & InvITs in the 2022-23 was ₹ 4,96,865.13 crore with 10% benefits paid out on death claims.⁴⁵ Non- Financial Sector in the year 2023-24.⁵³ The overall insurance density in India was USD 92 in FY 2022-23, wherein, Life segment Mutual Funds comprised 7.8% share in turnover of Cash segment of NSE in 2023-24 which is contributed USD 70 and General comprising USD 22 which is only a mild uptick from the USD 91 slightly below the 2022-23 share of 8%, similarly FPIs contributed 14.4 % in 2023-24 as opposed from FY 2021-22.⁴⁶ to 14.5% in 2022-23.⁵⁴ India, with an estimated market share of 1.9% of Global market in 2022-23, is on the course to Funds Industry become the sixth largest market in the world by 2032.⁴⁷ Reinsurance premium placed within India formed 17% of the total non-life gross domestic The Indian asset management sector has grown substantially, becoming a popular choice for premium booked in 2022-23, this was slightly less than the 22% in the previous year. The wealth creation, on account of increased financial awareness, regulatory strength, and FinTech premiums booked by General Insurance Company (Global Re-insurance solutions) and Foreign advancements. There has been a rise in systematic and passive investments, as well as ESG- Re-insurance Branches amounted to ₹ 54,678 crores in 2022-23 which is considerably less than focused investing, contributing to the landscape of Mutual Fund Industry. AIFs have also the previous year level of ₹ 61,337 crores.⁴⁸ expanded, benefiting from India's economic growth and a wealthier investor demographic. REITs and InvITs are new funding avenues that could significantly boost India's economic growth. In 2021-22, re-insurance premium placed within India through General Insurance Company (Global Re-insurance solutions) and Foreign Re-insurance Branches formed 62% of the Total The FY 2023-24 turned out to be one of the best periods for the Indian mutual fund industry as the reinsurance business of India whereas the re-insurance premium placed with Cross-Border re- AUM grew by nearly ₹ 14 lakh crores to a record ₹ 53.40 lakh crores as of March 2024 compared insurers only formed 38% of the total business. In 2022-23, however, these percentages have with ₹ 39.42 lakh crores as of March 2023.⁵⁵ This growth has been mainly driven by growing changed to 54% and 46% respectively denoting a considerable rise in the reinsurance placed participation of individual investors, buoyant equity markets and evolving investment strategies. through cross-border reinsurers. Equity was the primary asset class with mutual funds allocating 22.45 trillion Indian rupees, followed by debt with nearly 17 trillion Indian rupees deployed.⁵⁶ Capital Markets India's AIF industry reported a robust annual growth of 30%, with AUM increasing to ₹ 8.34 lakh There was strong resource mobilisation in Indian capital markets across sectors and instruments. crores from ₹ 6.41 lakh crores in the previous year. Category II funds accounted for the largest This was instrumental in the rapid recovery that Indian economy underwent. share with ₹ 6.94 lakh crores, marking a 34% increase from last year. The total AUM has nearly tripled over the past five years, reaching approximately USD 101 Bn in FY 2023. There were 12 IPOs in the financial sector during the year amounting to ₹ 7,628 crores and 260 in ⁴² Sigma Report, 2023, Swiss Re ⁴⁹ Current Statistics- Bulletin (Annexure Tables), April 2024, SEBI ⁴³ Handbook of Statistics, 2022-23, IRDAI ⁵⁰ ibid ⁴⁴ ibid ⁵¹ Monthly Bulletin, May 2024, SEBI ⁴⁵ ibid ⁵² Annual Report, 2022-23, SEBI ⁴⁶ Handbook of Statistics, 2022-23, IRDAI ⁵³ ibid ⁴⁷ Sigma Report, 2023, Swiss Re ⁵⁴ ibid ⁴⁸ IRDAI ⁵⁵ Annual Report, Feb 2024, AMFI ⁵⁶ Monthly Bulletin, May 2024, SEBI 08 092023-24 Bullion compared to the FY 2022-23 values. The non-petroleum and non-gems & jewellery sector experienced a modest uptick of 1.45%, escalating from USD 315.64 Bn in FY 2022-23 to USD India is one of the top consumers of precious metals in the world. Gold and Silver are an important 320.21 Bn in fiscal year 2023-24.⁶⁴ component of total bullion demand in India. Jewellery is one of the most popular forms of gold and silver consumption. However, there are other forms of gold consumption that contribute to the The export value of services was USD 325.55 Bn in FY 2022-23 and is expected to rise to USD demand for gold in India as well, for instance, India is a major consumer of Gold Potassium Cyanide 339.62 Bn in 2023-24. The overall trade deficit is anticipated to narrow significantly by 35.77%, which is used for electroplating in industries and making gold-plated jewellery and decorative declining from USD 121.62 Bn in FY 2022-23 to USD 78.12 Bn in FY 2023-24. This improvement is items like gold thread.⁵⁷ reflected in the merchandise trade deficit, which decreased by 9.33%, standing at USD 240.17 Bn in the current fiscal year compared to USD 264.90 Bn in fiscal year 2022-23.⁶⁵ The demand for gold turned out to be 95 tonnes in first quarter of 2024, which is a 4% rise from the level reported in the previous year. The level of gold bar and coin investment also registered a Overall, the Indian economy hurdled over the headwinds that emerged throughout the year, growth of 19% (YoY), rising from 34.4 tonnes in first quarter of 2023 to 41.1 tonnes in the first bolstered by the robust capital formation and manufacturing activity, further enhanced by a strong quarter of 2024.⁵⁸ Gold worth USD 45.5 Bn was imported during 2023-24, increasing by 30.1 per banking system and a gradual but controlled fall in inflation. Although the policy makers cannot cent compared to the last year.⁵⁹ put their guard down against the ill-effects from the multiple crises faced yet, the economy is expected to grow rapidly in the future. Fiscal Developments India's fiscal policy is geared towards ramping up spending on development and welfare initiatives, while also prioritizing investments in projects that bolster the economy's productive capacity. This commitment is complemented by a dedication to maintaining fiscal prudence, ensuring that public finances are managed responsibly and sustainably. The Fiscal Deficit in FY 2023-24 is estimated⁶⁰ at 5.8 % of GDP which is lower than the BE of FY 2023-24. The Revenue Deficit is expected to be lower, at 2.8 per cent of GDP in RE 2023-24 as compared to 2.9 per cent in BE 2023-24. The Fiscal Deficit in 2024-25 is estimated⁶¹ to be 5.1 per cent of GDP, as against the 5.8 per cent of GDP in 2023-24. In absolute terms, it means a deficit of ₹ 16.85 lakh crores in 2024-25 which is lower than the Fiscal Deficit of ₹ 17.35 lakh crores in 2023-24.⁶² The Budget Speech for FY 2021-22 highlighted the Government's approach to follow a broad path of fiscal consolidation so as to attain a level of Fiscal Deficit lower than 4.5 per cent of GDP by FY 2025-26. External Sector Although the supply shocks caused a global export slump, India recorded a high monthly merchandise export value of USD 41.68 Bn in March 2024 due to services exports which remained stable during this period. The total export value (merchandise and services) is estimated to reach USD 776.68 Bn in FY 2023-24 against 776.40 Bn recorded in FY 2022-23.⁶³ A significant contributor to this growth in the FY 2023-24 were Electronic Goods, Drugs and Pharmaceuticals and Engineering goods. The Electronic goods exports surged by 23.64% to USD 29.12 Bn, while drugs and pharmaceuticals exports grew by 9.67% to USD 27.85 Bn, and engineering goods exports saw a modest rise of 2.13% to USD 109.32 Bn, during the FY 2023-24, ⁵⁷ Gold Demand Trends, 2024, World Gold Council ⁵⁸ Gold Demand Trends (Executive Summary), 2024, World Gold Council ⁵⁹ Annual report, 2023-24, RBI ⁶⁰ RE released by MoF under the Statements of Fiscal policy as required under the FRBM Act, 2003 ⁶¹ Statements of Fiscal Policy, February 2024, MoF (Budget Division) ⁶² ibid ⁶³ Press Release, Ministry of Commerce, March 2024 ⁶⁴ ibid ⁶⁵ ibid 10 112023-24 Bullion compared to the FY 2022-23 values. The non-petroleum and non-gems & jewellery sector experienced a modest uptick of 1.45%, escalating from USD 315.64 Bn in FY 2022-23 to USD India is one of the top consumers of precious metals in the world. Gold and Silver are an important 320.21 Bn in fiscal year 2023-24.⁶⁴ component of total bullion demand in India. Jewellery is one of the most popular forms of gold and silver consumption. However, there are other forms of gold consumption that contribute to the The export value of services was USD 325.55 Bn in FY 2022-23 and is expected to rise to USD demand for gold in India as well, for instance, India is a major consumer of Gold Potassium Cyanide 339.62 Bn in 2023-24. The overall trade deficit is anticipated to narrow significantly by 35.77%, which is used for electroplating in industries and making gold-plated jewellery and decorative declining from USD 121.62 Bn in FY 2022-23 to USD 78.12 Bn in FY 2023-24. This improvement is items like gold thread.⁵⁷ reflected in the merchandise trade deficit, which decreased by 9.33%, standing at USD 240.17 Bn in the current fiscal year compared to USD 264.90 Bn in fiscal year 2022-23.⁶⁵ The demand for gold turned out to be 95 tonnes in first quarter of 2024, which is a 4% rise from the level reported in the previous year. The level of gold bar and coin investment also registered a Overall, the Indian economy hurdled over the headwinds that emerged throughout the year, growth of 19% (YoY), rising from 34.4 tonnes in first quarter of 2023 to 41.1 tonnes in the first bolstered by the robust capital formation and manufacturing activity, further enhanced by a strong quarter of 2024.⁵⁸ Gold worth USD 45.5 Bn was imported during 2023-24, increasing by 30.1 per banking system and a gradual but controlled fall in inflation. Although the policy makers cannot cent compared to the last year.⁵⁹ put their guard down against the ill-effects from the multiple crises faced yet, the economy is expected to grow rapidly in the future. Fiscal Developments India's fiscal policy is geared towards ramping up spending on development and welfare initiatives, while also prioritizing investments in projects that bolster the economy's productive capacity. This commitment is complemented by a dedication to maintaining fiscal prudence, ensuring that public finances are managed responsibly and sustainably. The Fiscal Deficit in FY 2023-24 is estimated⁶⁰ at 5.8 % of GDP which is lower than the BE of FY 2023-24. The Revenue Deficit is expected to be lower, at 2.8 per cent of GDP in RE 2023-24 as compared to 2.9 per cent in BE 2023-24. The Fiscal Deficit in 2024-25 is estimated⁶¹ to be 5.1 per cent of GDP, as against the 5.8 per cent of GDP in 2023-24. In absolute terms, it means a deficit of ₹ 16.85 lakh crores in 2024-25 which is lower than the Fiscal Deficit of ₹ 17.35 lakh crores in 2023-24.⁶² The Budget Speech for FY 2021-22 highlighted the Government's approach to follow a broad path of fiscal consolidation so as to attain a level of Fiscal Deficit lower than 4.5 per cent of GDP by FY 2025-26. External Sector Although the supply shocks caused a global export slump, India recorded a high monthly merchandise export value of USD 41.68 Bn in March 2024 due to services exports which remained stable during this period. The total export value (merchandise and services) is estimated to reach USD 776.68 Bn in FY 2023-24 against 776.40 Bn recorded in FY 2022-23.⁶³ A significant contributor to this growth in the FY 2023-24 were Electronic Goods, Drugs and Pharmaceuticals and Engineering goods. The Electronic goods exports surged by 23.64% to USD 29.12 Bn, while drugs and pharmaceuticals exports grew by 9.67% to USD 27.85 Bn, and engineering goods exports saw a modest rise of 2.13% to USD 109.32 Bn, during the FY 2023-24, ⁵⁷ Gold Demand Trends, 2024, World Gold Council ⁵⁸ Gold Demand Trends (Executive Summary), 2024, World Gold Council ⁵⁹ Annual report, 2023-24, RBI ⁶⁰ RE released by MoF under the Statements of Fiscal policy as required under the FRBM Act, 2003 ⁶¹ Statements of Fiscal Policy, February 2024, MoF (Budget Division) ⁶² ibid ⁶³ Press Release, Ministry of Commerce, March 2024 ⁶⁴ ibid ⁶⁵ ibid 10 11Hon'ble Prime Minister of India inaugurating the InFinity Forum 2.0 Hon'ble Union Minister of Finance and Corporate Affairs Smt. Nirmala Sitharaman visit to IFSCA Head Office 122023-24 (iii) A Bank planning to set up an IBC is required to satisfy the following conditions for grant of BANKING licence by the Authority: a. The Parent Bank shall provide necessary capital for the IBC, subject to a minimum of Banking sector is one of the most important pillars of an international financial centre both as a USD 50 Mn or such other level of capital that may be specified by the Authority financial intermediary and as a provider of key services to other financial institutions. The b. Such capital shall be calculated and shall be maintained as specified by the Authority. c. The Parent Bank shall obtain a No Objection Letter from its Home Regulator regarding IFSCA Banking regulations notified in November 2020 and directions / guidelines issued setting up of IBC of the parent bank. thereunder were aimed at enabling and facilitating various banking activities generally d. Any other condition that the Authority may specify carried out by internationally active banks in international financial centres across the globe while ensuring a smooth transition from the RBI guidelines that were applicable prior to the (iv) In line with DEA notification on specification of foreign currencies u/s 20 of the IFSCA Act, IFSCA Banking Regulations. 2019 (dated July 3, 2023), list of specified foreign currencies were added in the first schedule of the IFSCA (Banking) Regulations, 2021 (as amended). These are as under: With a view to further enhancing 'ease of doing banking business' in GIFT IFSC, the Authority issued the IFSCA Banking Handbook which acts as a compendium of all the detailed directions SPECIFIED FOREIGN CURRENCIES of the Authority to the IBUs operating in GIFT IFSC. a. US Dollar (USD) b. Euro (EUR) The vibrant banking ecosystem in GIFT IFSC today comprises 11 foreign and 16 domestic banks c. Japanese Yen (JPY) set up as branches of the parent bank called IFSC Banking Units (IBUs). As of March 2024, the d. UK Pound Sterling (GBP) total Asset size of IBUs crossed USD 60 Bn and the cumulative value of transactions undertaken e. Canadian Dollar (CAD) by IBUs crossed USD 795 Bn. Credit exposure stood at USD 34.92 Bn as on March 2024, covering f. Australian Dollar (AUD) countries like US, UK, Singapore, UAE etc. apart from India. g. Swiss Franc (CHF) h. Hong Kong Dollar (HKD) IFSCA Banking Regulations were amended in June 2022, to allow Global Administrative Office i. Singapore Dollar (SGD) (GAO) to be setup in IFSC. Further, recent amendments carried out in July, 2023 to the j. UAE Dirham (AED) k. Russian Rouble (RUB) regulations now permit Indian and Foreign banks to set up subsidiaries (to be called IFSC Banking Companies or IBCs). (v) Banking units (BUs) were earlier permitted to undertake permissible activities (as specified in ACBU Module, GEN Directions, IFSCA banking Handbook) in freely convertible foreign currency. Under the amended regulations, BUs can undertake permissible Policy/ Regulatory Developments activities in the specified currencies and with such persons, whether resident or otherwise, as may be specified by the Authority. Provided that a Banking Unit may be This section gives a picture of the major measures taken by the Authority towards the regulation of permitted to conduct such business in INR with such persons, whether resident or banking and related services and the development of banking ecosystem in IFSC during FY otherwise, as may be specified by the Authority, subject to settlement of the financial 2023-24. transaction in relation to such business in the specified foreign currencies. (vi) A Foreign Bank, not having its presence in India, wishing to set up a Banking Unit in an IFSC, IFSCA (Banking) (Amendment) Regulations, 2023 shall comply with such additional requirements as may be specified by the Authority. The Authority has come out with a framework/SOP for processing the application of foreign (i) Prior to the notification of these regulations, Banks were only permitted to set up banks (not having presence in India), in compliance with provision of extant statutes. operations in IFSC in the form of a branch termed as IFSC Banking Units (IBUs). The Regulations have been amended to permit banks to set up IFSC Banking Companies (IBCs) (vii) The activity of providing “Referral services⁶⁸” is now included as one of the permitted in the form of a subsidiary.⁶⁶ activities under these amended regulations. (ii) A Bank is permitted be set up⁶⁷ an IBU or IBC in IFSC, subject to approval of the Authority. A (viii) Under the earlier Regulations it was prescribed that Deposit Insurance shall not be Bank who has already set up an IBU in an IFSC, may be permitted to convert the same into applicable for deposits opened by banking units. Under the amended regulations, it is an IBC, with the prior approval of the Authority, subject to such conditions as may be prescribed that deposits of a Banking Unit may be insured subject to applicability of and to specified by the Authority. the extent provided under the Deposit Insurance and Credit Guarantee Corporation Act, 1961 and any rules or regulations made thereunder. ⁶⁶ Company that satisfies the definition u/s 2(87) of the Companies Act, 2013. ⁶⁸ Means an activity in which a BU, pursuant to an arrangement with a financial product or financial service provider, refers its clients or the clients of ⁶⁷ Earlier Banks were only permitted to set up a banking unit in the form of a branch as IBU its Parent Bank as potential customers (or "leads"), to such financial product or financial service provider for providing them the financial product(s) or financial service(s) 14 152023-24 (iii) A Bank planning to set up an IBC is required to satisfy the following conditions for grant of BANKING licence by the Authority: a. The Parent Bank shall provide necessary capital for the IBC, subject to a minimum of Banking sector is one of the most important pillars of an international financial centre both as a USD 50 Mn or such other level of capital that may be specified by the Authority financial intermediary and as a provider of key services to other financial institutions. The b. Such capital shall be calculated and shall be maintained as specified by the Authority. c. The Parent Bank shall obtain a No Objection Letter from its Home Regulator regarding IFSCA Banking regulations notified in November 2020 and directions / guidelines issued setting up of IBC of the parent bank. thereunder were aimed at enabling and facilitating various banking activities generally d. Any other condition that the Authority may specify carried out by internationally active banks in international financial centres across the globe while ensuring a smooth transition from the RBI guidelines that were applicable prior to the (iv) In line with DEA notification on specification of foreign currencies u/s 20 of the IFSCA Act, IFSCA Banking Regulations. 2019 (dated July 3, 2023), list of specified foreign currencies were added in the first schedule of the IFSCA (Banking) Regulations, 2021 (as amended). These are as under: With a view to further enhancing 'ease of doing banking business' in GIFT IFSC, the Authority issued the IFSCA Banking Handbook which acts as a compendium of all the detailed directions SPECIFIED FOREIGN CURRENCIES of the Authority to the IBUs operating in GIFT IFSC. a. US Dollar (USD) b. Euro (EUR) The vibrant banking ecosystem in GIFT IFSC today comprises 11 foreign and 16 domestic banks c. Japanese Yen (JPY) set up as branches of the parent bank called IFSC Banking Units (IBUs). As of March 2024, the d. UK Pound Sterling (GBP) total Asset size of IBUs crossed USD 60 Bn and the cumulative value of transactions undertaken e. Canadian Dollar (CAD) by IBUs crossed USD 795 Bn. Credit exposure stood at USD 34.92 Bn as on March 2024, covering f. Australian Dollar (AUD) countries like US, UK, Singapore, UAE etc. apart from India. g. Swiss Franc (CHF) h. Hong Kong Dollar (HKD) IFSCA Banking Regulations were amended in June 2022, to allow Global Administrative Office i. Singapore Dollar (SGD) (GAO) to be setup in IFSC. Further, recent amendments carried out in July, 2023 to the j. UAE Dirham (AED) k. Russian Rouble (RUB) regulations now permit Indian and Foreign banks to set up subsidiaries (to be called IFSC Banking Companies or IBCs). (v) Banking units (BUs) were earlier permitted to undertake permissible activities (as specified in ACBU Module, GEN Directions, IFSCA banking Handbook) in freely convertible foreign currency. Under the amended regulations, BUs can undertake permissible Policy/ Regulatory Developments activities in the specified currencies and with such persons, whether resident or otherwise, as may be specified by the Authority. Provided that a Banking Unit may be This section gives a picture of the major measures taken by the Authority towards the regulation of permitted to conduct such business in INR with such persons, whether resident or banking and related services and the development of banking ecosystem in IFSC during FY otherwise, as may be specified by the Authority, subject to settlement of the financial 2023-24. transaction in relation to such business in the specified foreign currencies. (vi) A Foreign Bank, not having its presence in India, wishing to set up a Banking Unit in an IFSC, IFSCA (Banking) (Amendment) Regulations, 2023 shall comply with such additional requirements as may be specified by the Authority. The Authority has come out with a framework/SOP for processing the application of foreign (i) Prior to the notification of these regulations, Banks were only permitted to set up banks (not having presence in India), in compliance with provision of extant statutes. operations in IFSC in the form of a branch termed as IFSC Banking Units (IBUs). The Regulations have been amended to permit banks to set up IFSC Banking Companies (IBCs) (vii) The activity of providing “Referral services⁶⁸” is now included as one of the permitted in the form of a subsidiary.⁶⁶ activities under these amended regulations. (ii) A Bank is permitted be set up⁶⁷ an IBU or IBC in IFSC, subject to approval of the Authority. A (viii) Under the earlier Regulations it was prescribed that Deposit Insurance shall not be Bank who has already set up an IBU in an IFSC, may be permitted to convert the same into applicable for deposits opened by banking units. Under the amended regulations, it is an IBC, with the prior approval of the Authority, subject to such conditions as may be prescribed that deposits of a Banking Unit may be insured subject to applicability of and to specified by the Authority. the extent provided under the Deposit Insurance and Credit Guarantee Corporation Act, 1961 and any rules or regulations made thereunder. ⁶⁶ Company that satisfies the definition u/s 2(87) of the Companies Act, 2013. ⁶⁸ Means an activity in which a BU, pursuant to an arrangement with a financial product or financial service provider, refers its clients or the clients of ⁶⁷ Earlier Banks were only permitted to set up a banking unit in the form of a branch as IBU its Parent Bank as potential customers (or "leads"), to such financial product or financial service provider for providing them the financial product(s) or financial service(s) 14 152023-24 IFSCA Banking Handbook payments related transactions especially in the area of cross-border payments between India and rest of world, it was felt essential to prescribe regulations for orderly growth of the payment IFSCA Banking Handbook Gen Directions – Version 4.0 services ecosystem in IFSC. In case of any change in the material outsourcing arrangement, IBUs have been mandated to Further, many FinTech entities/start-ups, who have been admitted in the IFSCA FinTech Sandbox inform the Authority within 7 days. for testing their use-case of their offerings are in the payments domain. Once they exit the Sandbox, there would be a requirement of an enabling regulation to authorise and regulate their operations. The IFSCA Banking Handbook COB Direction- Version 5.0 The IFSCA (Payment Services) Regulations, 2024 adopts a principle-based approach and lays (i) Definition of specified currencies was added in line with the Department of Economic Affairs down the authorisation, governance and risk management norms and requirements for payment (DEA), MoF notification dated July 3, 2023, on specification of foreign currencies. List of service providers. The salient features of the regulations are: Specified currencies include 11 currencies. i. The term 'payment services' has been defined and the payment services allowed under (ii) Under Permissible activities, IBUs can undertake following additional activities/services: the regulations have been specified which are- a. Providing services⁶⁹ to Designated Entities⁷⁰ without Risk Participation. a. Account issuance service b. Act as a system participant and/or a system provider for an authorised payment system. b. E-money issuance service c. Offering payment services as defined in the regulation on Payment services issued by the c. Escrow service Authority. d. Cross border money transfer service d. Issuing ODIs on securities as listed u/s 2(h)(i) of the Securities Contract (Regulation) e. Merchant acquisition service Act, 1956 (as amended). ii. The activities which are kept outside the definition of payment services have also been The IFSCA Banking Handbook PRU Direction- Version 4.0 specified under the regulations. i. Clarification was issued to IBUs about requirement of Statutory Audit under applicable iii. The eligibility and requirements relating to authorisation have been specified in the laws. regulations. ii. Guidance note for IBUs of foreign banks was included regarding the provisions of section iv. Governance arrangements which are to be adopted by the payment service providers 29 of the Banking Regulation Act, 1949 which, inter alia, permits a banking company have been laid down in the regulations. incorporated outside India, in respect of all business transacted through its branches in v. The regulations also provide a framework for risk management of third-party service India, to prepare a balance-sheet and profit and loss account as on the last working day of relationships which payment service providers may enter into. that year or the period, as the case may be, in the forms set out in the third schedule of the Act. vi. The duties of the payment service providers with respect to various stakeholders have been laid down in the regulations. IFSCA (Payment Services) Regulations, 2024 vii. The regulations lay down the customer complaint handling procedures for payment service providers including online reconciliation services. Section 3(1) (e) (xi) of the IFSCA Act, 2019 lists “selling, providing, or issuing stored value or payment instruments or providing payment services” as one of the financial services that financial Circulars institutions in IFSC may provide and Section 12 (1) of the IFSCA Act, 2019 empowers the Authority to develop and regulate the financial products, financial services and financial institutions in the Opening Special Non-Resident Rupee (SNRR) account with Authorized Dealer Bank in India IFSC. (August 30, 2023) Due to the demand from various participants in the financial ecosystem and users of the financial As per earlier provisions, IBUs were not allowed to open SNRR account with AD Bank in India of services (money transfer service providers, NRIs, foreign investors, payment application which it is a branch. These provisions have been modified and accordingly, IBUs can now open an providers etc.) and the focus of new age startups on the smoothening and easing the payments and INR account in the form of SNRR Account, with an AD bank in India to defray their administrative expenses in compliance with directions of RBI in this regard. ⁶⁹ Services include managing the risk of transactions booked by the designated entities and providing support to global sales/ trading/ structuring teams of the designated entity ⁷⁰ Designated entities are group entities of a parent bank of an IBU 16 172023-24 IFSCA Banking Handbook payments related transactions especially in the area of cross-border payments between India and rest of world, it was felt essential to prescribe regulations for orderly growth of the payment IFSCA Banking Handbook Gen Directions – Version 4.0 services ecosystem in IFSC. In case of any change in the material outsourcing arrangement, IBUs have been mandated to Further, many FinTech entities/start-ups, who have been admitted in the IFSCA FinTech Sandbox inform the Authority within 7 days. for testing their use-case of their offerings are in the payments domain. Once they exit the Sandbox, there would be a requirement of an enabling regulation to authorise and regulate their operations. The IFSCA Banking Handbook COB Direction- Version 5.0 The IFSCA (Payment Services) Regulations, 2024 adopts a principle-based approach and lays (i) Definition of specified currencies was added in line with the Department of Economic Affairs down the authorisation, governance and risk management norms and requirements for payment (DEA), MoF notification dated July 3, 2023, on specification of foreign currencies. List of service providers. The salient features of the regulations are: Specified currencies include 11 currencies. i. The term 'payment services' has been defined and the payment services allowed under (ii) Under Permissible activities, IBUs can undertake following additional activities/services: the regulations have been specified which are- a. Providing services⁶⁹ to Designated Entities⁷⁰ without Risk Participation. a. Account issuance service b. Act as a system participant and/or a system provider for an authorised payment system. b. E-money issuance service c. Offering payment services as defined in the regulation on Payment services issued by the c. Escrow service Authority. d. Cross border money transfer service d. Issuing ODIs on securities as listed u/s 2(h)(i) of the Securities Contract (Regulation) e. Merchant acquisition service Act, 1956 (as amended). ii. The activities which are kept outside the definition of payment services have also been The IFSCA Banking Handbook PRU Direction- Version 4.0 specified under the regulations. i. Clarification was issued to IBUs about requirement of Statutory Audit under applicable iii. The eligibility and requirements relating to authorisation have been specified in the laws. regulations. ii. Guidance note for IBUs of foreign banks was included regarding the provisions of section iv. Governance arrangements which are to be adopted by the payment service providers 29 of the Banking Regulation Act, 1949 which, inter alia, permits a banking company have been laid down in the regulations. incorporated outside India, in respect of all business transacted through its branches in v. The regulations also provide a framework for risk management of third-party service India, to prepare a balance-sheet and profit and loss account as on the last working day of relationships which payment service providers may enter into. that year or the period, as the case may be, in the forms set out in the third schedule of the Act. vi. The duties of the payment service providers with respect to various stakeholders have been laid down in the regulations. IFSCA (Payment Services) Regulations, 2024 vii. The regulations lay down the customer complaint handling procedures for payment service providers including online reconciliation services. Section 3(1) (e) (xi) of the IFSCA Act, 2019 lists “selling, providing, or issuing stored value or payment instruments or providing payment services” as one of the financial services that financial Circulars institutions in IFSC may provide and Section 12 (1) of the IFSCA Act, 2019 empowers the Authority to develop and regulate the financial products, financial services and financial institutions in the Opening Special Non-Resident Rupee (SNRR) account with Authorized Dealer Bank in India IFSC. (August 30, 2023) Due to the demand from various participants in the financial ecosystem and users of the financial As per earlier provisions, IBUs were not allowed to open SNRR account with AD Bank in India of services (money transfer service providers, NRIs, foreign investors, payment application which it is a branch. These provisions have been modified and accordingly, IBUs can now open an providers etc.) and the focus of new age startups on the smoothening and easing the payments and INR account in the form of SNRR Account, with an AD bank in India to defray their administrative expenses in compliance with directions of RBI in this regard. ⁶⁹ Services include managing the risk of transactions booked by the designated entities and providing support to global sales/ trading/ structuring teams of the designated entity ⁷⁰ Designated entities are group entities of a parent bank of an IBU 16 172023-24 Allocation of Indian Financial System Code (IFSC code) to IBUs (November 28, 2023) Sources of fund raising for IBUs have been interbank and interbranch borrowings, medium term notes, borrowings from multilateral institutions, retail deposits, corporate deposits etc. Activities This circular was issued to enable IBUs to apply for and obtain IFSC codes. This would help them on asset deployment have been largely concentrated towards trade finance and commercial loans. undertake inward remittances from overseas jurisdiction through cross border payment systems that require IFSC Code of the destination branch of the bank in India as a compulsory requirement. Customer Credit (Net) of the IFSC Banking ecosystem as on March 31, 2024, stands at USD 39.11 Bn and total asset size of IBUs is USD 60.24 Bn. Avoiding rerouting of transactions to IBUs that have been wrongly credited in the parent AD bank's Nostro account – Reporting in R-Return (January 22, 2024) Figure 1: Outstanding of Major Credit Products (USD Mn) IFSCA issued directions to IBUs to adhere to the specific reporting procedures (Reporting in R Return) in case of transactions to IBUs from overseas bank that have been wrongly credited in the 30,000 parent AD bank's Nostro account. This would ensure that flow of remittance from overseas bank to 25,000 24656.8 IBUs takes place without delay and so as to avoid the need of rerouting funds that have been 20,000 wrongly credited to the Nostro account of the Parent bank. 14896.89 15,000 12715.54 Improving processing timelines of cross border payments (January 8, 2024) 10,000 7709.42 5,000 IBUs have been advised following measures for improving the processing timelines of cross 554.62184.03 496.00543.49 0 border payments: Trade Commercial Loans Against Sovereign loans Finance Loans deposits/securities (i) Upgrading their existing messaging solutions so as to have continuous visibility of the status of a transaction by use of services like SWIFT GPI etc. Mar 23 Mar 24 (ii) IBUs using SWIFT as messaging service may consider using MT 910 (Confirmation of credit message) instead of MT 940 (Customer Statement message) for crediting the accounts of its Total customer credit outstanding has increased by 63.36% from USD 23.94 Bn (as on 31.03.2023) constituents after due internal approval of such change of process. to USD 39.11 Bn (as on 31.03.2024). Growth in commercial loans and trade finance disbursed by (iii) To undertake a study and document their existing method of processing cross-border the IBUs has been the biggest contributor for this increase in the customer credit outstanding for transactions and how the speed of processing such transactions may be further improved. the IFSC. Transaction/Processes/Operations/Trends Figure 2: Turnover (Volume of Business) in USD Mn As on March 31, 2024, the Banking ecosystem at IFSC has 23 IBUs operating and 4 IBUs have been 30,000 given licenses and are expected to commence operations during the FY 2024-25. 19320.55 20,000 14901.59 15,000 Table 1: No. of IBUs 10316.86 10121.66 10,000 Particulars FY 2022-23 FY 2023-24 5,000 2956.915029.38 3161.163898.35 725.68949.48 No. of operational IBUs at IFSC 20 23 0 7.56 2.39 Loan Trade (Fund Interbranch Interbank (ESB and and Investments others Placements Placements Table 2: Total Assets in IBUs in USD Mn Commercial Loan) Non Fund) FY 22-23 FY 23-24 Particulars Outstanding as on Mar 31, 2023 Outstanding as on Mar 31, 2024 Total Assets at IFSC 38,286.41 60,248.15 Table 3: No. of employees in all IBUs Particulars FY 2022-23 FY 2023-24 No. of employees at all IBUs located in IFSC 277 343 18 192023-24 Allocation of Indian Financial System Code (IFSC code) to IBUs (November 28, 2023) Sources of fund raising for IBUs have been interbank and interbranch borrowings, medium term notes, borrowings from multilateral institutions, retail deposits, corporate deposits etc. Activities This circular was issued to enable IBUs to apply for and obtain IFSC codes. This would help them on asset deployment have been largely concentrated towards trade finance and commercial loans. undertake inward remittances from overseas jurisdiction through cross border payment systems that require IFSC Code of the destination branch of the bank in India as a compulsory requirement. Customer Credit (Net) of the IFSC Banking ecosystem as on March 31, 2024, stands at USD 39.11 Bn and total asset size of IBUs is USD 60.24 Bn. Avoiding rerouting of transactions to IBUs that have been wrongly credited in the parent AD bank's Nostro account – Reporting in R-Return (January 22, 2024) Figure 1: Outstanding of Major Credit Products (USD Mn) IFSCA issued directions to IBUs to adhere to the specific reporting procedures (Reporting in R Return) in case of transactions to IBUs from overseas bank that have been wrongly credited in the 30,000 parent AD bank's Nostro account. This would ensure that flow of remittance from overseas bank to 25,000 24656.8 IBUs takes place without delay and so as to avoid the need of rerouting funds that have been 20,000 wrongly credited to the Nostro account of the Parent bank. 14896.89 15,000 12715.54 Improving processing timelines of cross border payments (January 8, 2024) 10,000 7709.42 5,000 IBUs have been advised following measures for improving the processing timelines of cross 554.62184.03 496.00543.49 0 border payments: Trade Commercial Loans Against Sovereign loans Finance Loans deposits/securities (i) Upgrading their existing messaging solutions so as to have continuous visibility of the status of a transaction by use of services like SWIFT GPI etc. Mar 23 Mar 24 (ii) IBUs using SWIFT as messaging service may consider using MT 910 (Confirmation of credit message) instead of MT 940 (Customer Statement message) for crediting the accounts of its Total customer credit outstanding has increased by 63.36% from USD 23.94 Bn (as on 31.03.2023) constituents after due internal approval of such change of process. to USD 39.11 Bn (as on 31.03.2024). Growth in commercial loans and trade finance disbursed by (iii) To undertake a study and document their existing method of processing cross-border the IBUs has been the biggest contributor for this increase in the customer credit outstanding for transactions and how the speed of processing such transactions may be further improved. the IFSC. Transaction/Processes/Operations/Trends Figure 2: Turnover (Volume of Business) in USD Mn As on March 31, 2024, the Banking ecosystem at IFSC has 23 IBUs operating and 4 IBUs have been 30,000 given licenses and are expected to commence operations during the FY 2024-25. 19320.55 20,000 14901.59 15,000 Table 1: No. of IBUs 10316.86 10121.66 10,000 Particulars FY 2022-23 FY 2023-24 5,000 2956.915029.38 3161.163898.35 725.68949.48 No. of operational IBUs at IFSC 20 23 0 7.56 2.39 Loan Trade (Fund Interbranch Interbank (ESB and and Investments others Placements Placements Table 2: Total Assets in IBUs in USD Mn Commercial Loan) Non Fund) FY 22-23 FY 23-24 Particulars Outstanding as on Mar 31, 2023 Outstanding as on Mar 31, 2024 Total Assets at IFSC 38,286.41 60,248.15 Table 3: No. of employees in all IBUs Particulars FY 2022-23 FY 2023-24 No. of employees at all IBUs located in IFSC 277 343 18 192023-24 Figure 3: Investment Profile in USD Mn Figure 4 : Major Country exposure of IBUs 1,800.00 1,597.81 1,600.00 1,400.00 1,200.26 1,200.00 957.64 1,000.00 800.00 757.02 600.00 400.00 200.00 69.84 39.30 16.25 0.00 9.86 10.25 - Treasury Bill Corporate Bonds/ Equity Shares/ Mutual Funds Others Debentures Preference Shares March 31, 2023 March 31, 2024 IBUs were maintaining investment in Treasury bills for compliance with the prudential requirement of LCR maintenance. However, as per the guidelines, IBUs have been permitted to maintain LCR at their parent bank. Overall, there is a notable shift in investment preferences from IBUs have highest exposure to entities from India (74.63%) followed by USA (4.76%) and Treasury Bills to Corporate Bonds by the IBUs over the one-year period. Mauritius (3.72%). Top five countries constitute 89.75% of the exposure of the IBUs. Table 4: Derivative Outstanding (USD Mn) Working Group/ Committee Outstanding as on Outstanding as on Derivative Outstanding (USD Mn) Mar 31, 2023 Mar 31, 2024 A working group to deliberate on uniform working hours and holiday calendar for IBUs was Non-Deliverable Derivative Contracts (FCY-INR) 14092.67 26159.99 constituted with members from IFSCA, Indian Banks Association (IBA), IBUs of Indian and Foreign (including NDF, Fx-Swaps and options) Banks. The WG submitted its report to the Authority on January 22, 2024. Its recommendations FCY-FCY forwards 3082.44 4145.16 are as under: FCY-FCY currency swap 957.56 966.35 (i) IBUs to implement a five-workday week. FCY-FCY currency option 606.70 2515.61 (ii) IBUs to implement uniform working hours of 9:45 a.m. to 5:30 p.m. for undertaking common INR Interest rate swap (IRS) 25343.29 28045.45 set of activities being offered to market participants/FIs. For undertaking specialised (including overnight indexed swaps (OIS) services, flexibility may be given to IBUs to carve out a separate work shift arrangement, as FCY Interest rate swap (IRS) 66924.23 101681.32 (including overnight indexed swaps (OIS)) per business requirement of their clients. Others 1.62 663.34 (iii) IBUs to adopt the Mumbai holiday calendar. Total 111008.51 164177.22 (iv) IFSCA to specify regulatory guidelines along with timeline to all IBUs for putting in place the appropriate system that is automated (24*7), through internet banking services for offering The outstanding derivative contracts at IFSC have increased by 47.90%. A few IBUs have certain basic services to their customers. An STP to Swift messaging system also would help commenced their market operations during the financial year whereas a few have increased their within certain limits through internet banking, as it is prevalent in India. derivative trading portfolio based on their business strategies resulting in the overall increase in the derivative contracts outstanding at IBUs as on March 31, 2024. 20 212023-24 Figure 3: Investment Profile in USD Mn Figure 4 : Major Country exposure of IBUs 1,800.00 1,597.81 1,600.00 1,400.00 1,200.26 1,200.00 957.64 1,000.00 800.00 757.02 600.00 400.00 200.00 69.84 39.30 16.25 0.00 9.86 10.25 - Treasury Bill Corporate Bonds/ Equity Shares/ Mutual Funds Others Debentures Preference Shares March 31, 2023 March 31, 2024 IBUs were maintaining investment in Treasury bills for compliance with the prudential requirement of LCR maintenance. However, as per the guidelines, IBUs have been permitted to maintain LCR at their parent bank. Overall, there is a notable shift in investment preferences from IBUs have highest exposure to entities from India (74.63%) followed by USA (4.76%) and Treasury Bills to Corporate Bonds by the IBUs over the one-year period. Mauritius (3.72%). Top five countries constitute 89.75% of the exposure of the IBUs. Table 4: Derivative Outstanding (USD Mn) Working Group/ Committee Outstanding as on Outstanding as on Derivative Outstanding (USD Mn) Mar 31, 2023 Mar 31, 2024 A working group to deliberate on uniform working hours and holiday calendar for IBUs was Non-Deliverable Derivative Contracts (FCY-INR) 14092.67 26159.99 constituted with members from IFSCA, Indian Banks Association (IBA), IBUs of Indian and Foreign (including NDF, Fx-Swaps and options) Banks. The WG submitted its report to the Authority on January 22, 2024. Its recommendations FCY-FCY forwards 3082.44 4145.16 are as under: FCY-FCY currency swap 957.56 966.35 (i) IBUs to implement a five-workday week. FCY-FCY currency option 606.70 2515.61 (ii) IBUs to implement uniform working hours of 9:45 a.m. to 5:30 p.m. for undertaking common INR Interest rate swap (IRS) 25343.29 28045.45 set of activities being offered to market participants/FIs. For undertaking specialised (including overnight indexed swaps (OIS) services, flexibility may be given to IBUs to carve out a separate work shift arrangement, as FCY Interest rate swap (IRS) 66924.23 101681.32 (including overnight indexed swaps (OIS)) per business requirement of their clients. Others 1.62 663.34 (iii) IBUs to adopt the Mumbai holiday calendar. Total 111008.51 164177.22 (iv) IFSCA to specify regulatory guidelines along with timeline to all IBUs for putting in place the appropriate system that is automated (24*7), through internet banking services for offering The outstanding derivative contracts at IFSC have increased by 47.90%. A few IBUs have certain basic services to their customers. An STP to Swift messaging system also would help commenced their market operations during the financial year whereas a few have increased their within certain limits through internet banking, as it is prevalent in India. derivative trading portfolio based on their business strategies resulting in the overall increase in the derivative contracts outstanding at IBUs as on March 31, 2024. 20 212023-24 Advocacy and Outreach International Conference on 'Role of IFSC in Export Credit & Export Credit Insurance’ The Ministry of Commerce and Industry, Government of India and IFSCA jointly organised an International Conference on the 'Role of IFSC in Export Credit and Export Credit Insurance' on December 19, 2023, at GIFT City, Gandhinagar, Gujarat. The conference was addressed by Shri. K Rajaraman, Chairman, IFSCA, Shri. Vivek Joshi, Secretary, Department of Financial Services, Ministry of Finance, Government of India and Shri. Paresh Kantilal Mehta, Regional Chairman, Federation of Indian Exporter Organisation (WR). Image 2 : Panelist for the session on "Closing the trade finance gap: Policy option" (From left to right: Shri M.P Tangirala, Additional Secy., DFS, MoF; Shri Vipul Bansal, Joint Secy., DoC, MoCI; Shri Rajneesh Karnatak, MD & CEO, Bank of India; Shri Tarun Sharma, DMD, EXIM Bank of India; Shri Supriyo Bhattacharjee, CGM, IFSCA) Policies and programmes for the following year Issue of IFSCA Banking Handbook for the IFSC banking Companies The Authority has amended the IFSCA (Banking) Regulations permitting Banks to set up IFSC Banking Companies (IBCs) in the form of subsidiary. Enabling framework in the form of compendium of directions under the IFSCA Banking Handbook shall be issued by the Authority. Image 1 : International Conference on role of IFSC in export credit and export credit insurance Issue of Framework under the Payment and Settlement Regulations The Authority has issued the draft Payment and Settlement Systems Regulations for public comments. Once the same is notified, IFSCA shall create the necessary framework thereunder for The conference served as a forum for deliberating and cross fertilisation of ideas on the dynamic authorisation of payment and settlement systems in IFSC. shifts within Export Credit and Export Credit Insurance, highlighting the role of IFSC in fostering growth within this sector. At the conference, experts actively participated in dynamic roundtable Foreign Currency Settlement System A Foreign Currency Settlement System is being setup in GIFT IFSC which would settle foreign discussions encompassing the following subjects: currency transactions (starting with USD) undertaken among IFSC Banking Units (IBUs) located (i) Demand for export credit and export credit insurance in GIFT IFSC. (ii) Trade finance funding gap: Global and Indian perspective (iii) Innovation in export credit and export credit insurance (iv) Role of IFSC in bridging the trade finance funding gap (v) Closing the trade finance gap: Policy options 22 232023-24 Advocacy and Outreach International Conference on 'Role of IFSC in Export Credit & Export Credit Insurance’ The Ministry of Commerce and Industry, Government of India and IFSCA jointly organised an International Conference on the 'Role of IFSC in Export Credit and Export Credit Insurance' on December 19, 2023, at GIFT City, Gandhinagar, Gujarat. The conference was addressed by Shri. K Rajaraman, Chairman, IFSCA, Shri. Vivek Joshi, Secretary, Department of Financial Services, Ministry of Finance, Government of India and Shri. Paresh Kantilal Mehta, Regional Chairman, Federation of Indian Exporter Organisation (WR). Image 2 : Panelist for the session on "Closing the trade finance gap: Policy option" (From left to right: Shri M.P Tangirala, Additional Secy., DFS, MoF; Shri Vipul Bansal, Joint Secy., DoC, MoCI; Shri Rajneesh Karnatak, MD & CEO, Bank of India; Shri Tarun Sharma, DMD, EXIM Bank of India; Shri Supriyo Bhattacharjee, CGM, IFSCA) Policies and programmes for the following year Issue of IFSCA Banking Handbook for the IFSC banking Companies The Authority has amended the IFSCA (Banking) Regulations permitting Banks to set up IFSC Banking Companies (IBCs) in the form of subsidiary. Enabling framework in the form of compendium of directions under the IFSCA Banking Handbook shall be issued by the Authority. Image 1 : International Conference on role of IFSC in export credit and export credit insurance Issue of Framework under the Payment and Settlement Regulations The Authority has issued the draft Payment and Settlement Systems Regulations for public comments. Once the same is notified, IFSCA shall create the necessary framework thereunder for The conference served as a forum for deliberating and cross fertilisation of ideas on the dynamic authorisation of payment and settlement systems in IFSC. shifts within Export Credit and Export Credit Insurance, highlighting the role of IFSC in fostering growth within this sector. At the conference, experts actively participated in dynamic roundtable Foreign Currency Settlement System A Foreign Currency Settlement System is being setup in GIFT IFSC which would settle foreign discussions encompassing the following subjects: currency transactions (starting with USD) undertaken among IFSC Banking Units (IBUs) located (i) Demand for export credit and export credit insurance in GIFT IFSC. (ii) Trade finance funding gap: Global and Indian perspective (iii) Innovation in export credit and export credit insurance (iv) Role of IFSC in bridging the trade finance funding gap (v) Closing the trade finance gap: Policy options 22 232023-24 training simulation devices”. Further, the provision of Asset Management Support Services FINANCE COMPANIES (AMSS) to the group entities of an IFSC registered lessor was also enabled without the need for a separate registration under the Ancillary services framework. This was introduced as a measure of ease of doing business for the aircraft leasing entities in IFSC. Finance Companies/Units (FCs/FUs) play a crucial role in providing non-banking financial intermediation services in the IFSC. FCs/FUs are allowed to undertake activities similar to Transaction/Processes/Operations/Trends those enabled for the IBUs in IFSC except raising public deposits, thus complementing the role of the IBUs in terms of providing financial services. The IFSC witnessed growing interest from various entities seeking to establish themselves as The FCs/FUs are governed under the IFSCA (Finance Company) Regulations, 2021 with an Finance Company in IFSC, for undertaking various activities such as lending, factoring and objective to provide a risk-focused competitive environment for financial institutions, forfaiting, treasury centre activities, leasing of aircrafts and ships among others. ensuring fairness, transparency and efficiency while being aligned to international standards. Some of the major players registered as finance companies for undertaking various activities The core activities include lending, investments, trading in Derivatives, acting as a Global/ include the likes of IOC Global Capital management IFSC Ltd. (subsidiary of Indian Oil Regional Corporate Treasury Centre (GRCTC) and undertaking Factoring/ Forfaiting activities. Regulations have also enabled specific activities in the IFSC which includes Corporation), OVL Overseas IFSC Ltd. (subsidiary of ONGC Videsh Ltd), Exim Finservice IFSC Pvt. undertaking leasing of aircrafts, ships, and other equipment notified by IFSCA, setting up of Ltd. (subsidiary of EXIM Bank India), AI Fleet Services IFSC Ltd. (subsidiary of Air India) and Lotis Global and Regional Treasury Centres and International Trade Finance Platforms (ITFS IFSC Pvt. Ltd (subsidiary of Ambuja Cements Ltd. – part of Adani Group). A few of the ship leasing Platforms). entities registered include Jal Kumud Shipping IFSC Pvt Ltd., Athena Shipping IFSC Pvt. Ltd., Saigal Seatrade Services (IFSC) LLP and Ripley Pioneer India IFSC Pvt. Ltd. As of March 2024, the IFSCA has granted registration of 37 entities to set up as Financial Companies under the FC Regulations. Among these, 4 entities have been registered to engage in core activities like lending and factoring. With regards to FCs undertaking specific Table 5: Registered Finance Companies as on March 31, 2024 activities, 20 Aircraft Lessors have leased out a total of 125 aircraft assets from GIFT IFSC, 4 Ship Lessors and 3 ITFS entities have started commercial operations. Type of activity undertaken FC Aircraft Ship FC (non-core)–holding Total by the Finance Company (Core) Leasing Leasing cos and ITFS entities CoR Granted 4 20 8 5 37 Policy/ Regulatory Developments Table 6 : Aircraft Operating Lease (AOL) Entities Finance Company (core activities) S. No. of assets leased as on Type of Aviation Assets No. 31st March 2024 (i) Finance companies and Units were enabled as a 'Credit Institution' in January 2024 (by 1 Aircrafts 20 exercising powers under sec 33 A of the Credit Information Companies (Regulation) Act, 2005) for 2 Engines 49 undertaking permissible activities in IFSC. This is progressive step towards enabling acceptance/ 3 Ground Support Equipment 56 sharing data between CICs and IFSC units. The inclusion would permit Finance Companies/ Unit to Total 125 become member of Credit Information Companies (CICs), enabling them to exchange information on Indian borrowers with the CICs, thereby facilitating their due diligence processes. Table 7 : Ship leasing Entities (ii) A clarificatory circular on the computation of ESG lending target was followed by a detailed S. No. of asset leased as on FAQ. Type of Assets No. 31st March 2024 Aircraft Leasing 1 Ships 4 Post modification in the SEZ Rules in February, 2023 by Dept of Commerce, Ministry of Commerce Table 8 : ITFS Platforms and Industry for sharing of office space and manpower, the Authority issued a circular in April 2023, to bring into effect to the same by specifying the eligible entities and process of application Number of Transactions Financed as on 31 March 2024 281 under it. The scope of Aircraft leasing framework was widened to include leasing of “Aviation Value of Transactions Financed as on 31 March 2024 USD 12.91 Mn 24 252023-24 training simulation devices”. Further, the provision of Asset Management Support Services FINANCE COMPANIES (AMSS) to the group entities of an IFSC registered lessor was also enabled without the need for a separate registration under the Ancillary services framework. This was introduced as a measure of ease of doing business for the aircraft leasing entities in IFSC. Finance Companies/Units (FCs/FUs) play a crucial role in providing non-banking financial intermediation services in the IFSC. FCs/FUs are allowed to undertake activities similar to Transaction/Processes/Operations/Trends those enabled for the IBUs in IFSC except raising public deposits, thus complementing the role of the IBUs in terms of providing financial services. The IFSC witnessed growing interest from various entities seeking to establish themselves as The FCs/FUs are governed under the IFSCA (Finance Company) Regulations, 2021 with an Finance Company in IFSC, for undertaking various activities such as lending, factoring and objective to provide a risk-focused competitive environment for financial institutions, forfaiting, treasury centre activities, leasing of aircrafts and ships among others. ensuring fairness, transparency and efficiency while being aligned to international standards. Some of the major players registered as finance companies for undertaking various activities The core activities include lending, investments, trading in Derivatives, acting as a Global/ include the likes of IOC Global Capital management IFSC Ltd. (subsidiary of Indian Oil Regional Corporate Treasury Centre (GRCTC) and undertaking Factoring/ Forfaiting activities. Regulations have also enabled specific activities in the IFSC which includes Corporation), OVL Overseas IFSC Ltd. (subsidiary of ONGC Videsh Ltd), Exim Finservice IFSC Pvt. undertaking leasing of aircrafts, ships, and other equipment notified by IFSCA, setting up of Ltd. (subsidiary of EXIM Bank India), AI Fleet Services IFSC Ltd. (subsidiary of Air India) and Lotis Global and Regional Treasury Centres and International Trade Finance Platforms (ITFS IFSC Pvt. Ltd (subsidiary of Ambuja Cements Ltd. – part of Adani Group). A few of the ship leasing Platforms). entities registered include Jal Kumud Shipping IFSC Pvt Ltd., Athena Shipping IFSC Pvt. Ltd., Saigal Seatrade Services (IFSC) LLP and Ripley Pioneer India IFSC Pvt. Ltd. As of March 2024, the IFSCA has granted registration of 37 entities to set up as Financial Companies under the FC Regulations. Among these, 4 entities have been registered to engage in core activities like lending and factoring. With regards to FCs undertaking specific Table 5: Registered Finance Companies as on March 31, 2024 activities, 20 Aircraft Lessors have leased out a total of 125 aircraft assets from GIFT IFSC, 4 Ship Lessors and 3 ITFS entities have started commercial operations. Type of activity undertaken FC Aircraft Ship FC (non-core)–holding Total by the Finance Company (Core) Leasing Leasing cos and ITFS entities CoR Granted 4 20 8 5 37 Policy/ Regulatory Developments Table 6 : Aircraft Operating Lease (AOL) Entities Finance Company (core activities) S. No. of assets leased as on Type of Aviation Assets No. 31st March 2024 (i) Finance companies and Units were enabled as a 'Credit Institution' in January 2024 (by 1 Aircrafts 20 exercising powers under sec 33 A of the Credit Information Companies (Regulation) Act, 2005) for 2 Engines 49 undertaking permissible activities in IFSC. This is progressive step towards enabling acceptance/ 3 Ground Support Equipment 56 sharing data between CICs and IFSC units. The inclusion would permit Finance Companies/ Unit to Total 125 become member of Credit Information Companies (CICs), enabling them to exchange information on Indian borrowers with the CICs, thereby facilitating their due diligence processes. Table 7 : Ship leasing Entities (ii) A clarificatory circular on the computation of ESG lending target was followed by a detailed S. No. of asset leased as on FAQ. Type of Assets No. 31st March 2024 Aircraft Leasing 1 Ships 4 Post modification in the SEZ Rules in February, 2023 by Dept of Commerce, Ministry of Commerce Table 8 : ITFS Platforms and Industry for sharing of office space and manpower, the Authority issued a circular in April 2023, to bring into effect to the same by specifying the eligible entities and process of application Number of Transactions Financed as on 31 March 2024 281 under it. The scope of Aircraft leasing framework was widened to include leasing of “Aviation Value of Transactions Financed as on 31 March 2024 USD 12.91 Mn 24 252023-24 Figure 5 : Number of Finance Companies in IFSC 37 22 13 FY 2021-22 FY 2022-23 FY 2023-24 Circulars (I) Guidance framework on Sustainable and Sustainability linked lending by financial institutions – Clarification (April 20, 2023) (ii) Utilisation of office space or manpower or both by entities undertaking aircraft leasing activity in the International Financial Services Centre (“IFSC”) (April 18, 2023) Image 3 : Global Maritime Summit Panel with Hon’ble Finance Minister (iii) Amendment to the IFSCA circular titled 'Framework for Aircraft Lease' - Enabling lease of Aircraft Leasing Aviation training simulation devices (April 26, 2023) Dublin visit Advocacy and Outreach A delegation from IFSCA participated in the Airline Economics event from January 29 – February 1, 2024, at Dublin, Ireland. Chief General Manager, IFSCA and General Manager, IFSCA held 36 (i) A round table conference titled 'Developmental aspects of the ITFS platforms in IFSC' was meetings with various participants across the spectrum in aviation industry to appraise them held by the division on December 12, 2023, for identifying further improvements to the ITFS about the regulatory landscape of IFSC, opportunities in the aircraft leasing at GIFT IFSC and the framework. The conference was attended by the ITFS entities in IFSC, IBUs, strategic heads from the Head Offices of IBUs, general insurance entities registered with IFSC and progress made so far in this sphere. The delegation explained the competitive advantage of GIFT prospective insurance entities in IFSC. The view of the participants was also sought on the IFSC and the potential opportunities stemming from the recent orders placed by the Indian amendments required in the ITFS Framework with the objective of bringing in operational airlines and how lessors can benefit from the existing mechanism in place for aircraft leasing at efficiency. GIFT IFSC. (ii) As a matter of bringing ease of doing business and to ensure that the regulations framed are best in class regular interactions are held across industry either in-house or through participation in industry events. IFSCA officials attended the Airline Economics event held in Ireland and in Delhi and interacted with global lessors and financiers. These events helped gain insight into the industry functioning and identifying policy enhancements to the IFSC environment in order that it becomes competitive with the global financial centres. (iii) A closed door round table was held with global corporates in Singapore wherein feedback was sought on the Global Regional Treasury Centre Framework. Insights were provided into the aspects that are looked in to for enabling the corporates to move their treasury to IFSC and comparison was drawn with the best practices in other jurisdictions. This enabled in undertaking the periodic review of the framework thereby bringing the IFSC at par with other preferred jurisdictions. (iv) The Global Maritime Summit held in Mumbai was attended by IFSCA representatives who participated in a roundtable discussion on “Opportunities for Ship Leasing in GIFT IFSC”. Image 4: IFSCA meeting with Ambassador of India to Ireland 26 272023-24 Figure 5 : Number of Finance Companies in IFSC 37 22 13 FY 2021-22 FY 2022-23 FY 2023-24 Circulars (I) Guidance framework on Sustainable and Sustainability linked lending by financial institutions – Clarification (April 20, 2023) (ii) Utilisation of office space or manpower or both by entities undertaking aircraft leasing activity in the International Financial Services Centre (“IFSC”) (April 18, 2023) Image 3 : Global Maritime Summit Panel with Hon’ble Finance Minister (iii) Amendment to the IFSCA circular titled 'Framework for Aircraft Lease' - Enabling lease of Aircraft Leasing Aviation training simulation devices (April 26, 2023) Dublin visit Advocacy and Outreach A delegation from IFSCA participated in the Airline Economics event from January 29 – February 1, 2024, at Dublin, Ireland. Chief General Manager, IFSCA and General Manager, IFSCA held 36 (i) A round table conference titled 'Developmental aspects of the ITFS platforms in IFSC' was meetings with various participants across the spectrum in aviation industry to appraise them held by the division on December 12, 2023, for identifying further improvements to the ITFS about the regulatory landscape of IFSC, opportunities in the aircraft leasing at GIFT IFSC and the framework. The conference was attended by the ITFS entities in IFSC, IBUs, strategic heads from the Head Offices of IBUs, general insurance entities registered with IFSC and progress made so far in this sphere. The delegation explained the competitive advantage of GIFT prospective insurance entities in IFSC. The view of the participants was also sought on the IFSC and the potential opportunities stemming from the recent orders placed by the Indian amendments required in the ITFS Framework with the objective of bringing in operational airlines and how lessors can benefit from the existing mechanism in place for aircraft leasing at efficiency. GIFT IFSC. (ii) As a matter of bringing ease of doing business and to ensure that the regulations framed are best in class regular interactions are held across industry either in-house or through participation in industry events. IFSCA officials attended the Airline Economics event held in Ireland and in Delhi and interacted with global lessors and financiers. These events helped gain insight into the industry functioning and identifying policy enhancements to the IFSC environment in order that it becomes competitive with the global financial centres. (iii) A closed door round table was held with global corporates in Singapore wherein feedback was sought on the Global Regional Treasury Centre Framework. Insights were provided into the aspects that are looked in to for enabling the corporates to move their treasury to IFSC and comparison was drawn with the best practices in other jurisdictions. This enabled in undertaking the periodic review of the framework thereby bringing the IFSC at par with other preferred jurisdictions. (iv) The Global Maritime Summit held in Mumbai was attended by IFSCA representatives who participated in a roundtable discussion on “Opportunities for Ship Leasing in GIFT IFSC”. Image 4: IFSCA meeting with Ambassador of India to Ireland 26 272023-24 approval off the Authority. Pursuant to the above notification, the Authority intends to issue Airline Economics Event – New Delhi guidelines specifying the condition and processes by which an FC/FU undertaking ship A delegation from IFSCA participated in the second edition of India specific event organized by the leasing in IFSC may avail this facility as issued in case of aircraft leasing entities. Airline Economics on February 27-28, 2024, at New Delhi. Chief General Manager, IFSCA Issuance of Framework for Holding Companies presented the IFSCA aircraft leasing and tax framework and the holistic approach of IFSCA and Govt. of India with regards to developing GIFT IFSC as a hub for aircraft leasing. The discussions The framework would provide companies with an avenue to set up holding company in IFSC for were held on a wide array of topics relating to aircraft leasing and financing at GIFT IFSC. Several their overseas or domestic business expansion. This will enable Indian corporates and global bilateral meetings were also organized. corporates to strategize their investments overseas and investments in India respectively. Ship Leasing Policy enhancements in Aircraft and Shipping sector required to transform IFSC into a Financing Hub Marine Money India Ship Finance Forum Currently, IFSC has facilitated leasing of aircrafts and ships. However, in order to transform IFSC A delegation from the IFSCA participated in the inaugural edition of India specific event organized into an aircraft and ship financing hub, a number of tax and sectoral policy changes are required. by the Marine Money on February 20, 2024, at Mumbai. Chairperson, IFSCA delivered a keynote Detailed policy papers have been sent to Ministry of Finance, Shipping and Civil Aviation. address in which he appraised the participants about the opportunities available for ship leasing and financing at GIFT IFSC. Executive Director, IFSCA participated in the panel discussion to deliberate upon Ship Acquisition, Leasing and Financing at GIFT IFSC. Policies and programs for the following year Review of the Finance Company Regulations According to the IFSCA (Procedure for Making Regulations) Regulations, all regulations issued by the Authority must undergo a review every three years. Consequently, the FC Regulations and relevant circulars will be evaluated and appropriately modified/amended to facilitate the ease of doing business for entities. This review process will also entail making necessary amendments to circulars and frameworks in consultation with the industry. Enabling Finance Companies in IFSC to undertake investment in the form of Participating Interest Participating interest (PI) is a type of investment which grants investors a proportional ownership stake in a project, typically within the natural resource exploration sector, such as an oil and gas exploration block, or minerals etc. This type of investment provides stakeholders with a share in the assets/natural resources being explored and subsequently extracted. Facilitating PI may enable entities to engage in strategic investments in natural resource exploration and production, thereby potentially benefiting India's energy security. Enabling circulars related to 'Ship Leasing in IFSC' (i) Issuing clarifications regarding the nature of activities permissible for ship lessors in IFSC. Essentially, it will specify that ship leasing can be conducted by any entities that own ships or hold leasehold rights over ships or ocean vessels. (ii) The Ministry of Commerce and Industry vide Gazette Notification dated March 14, 2024, had amended rule 21B of the SEZ Rules 2006, to enable ship leasing unit in IFSC to utilise the office space or manpower or both of another unit in IFSC for the purpose of ship leasing, with the 28 292023-24 approval off the Authority. Pursuant to the above notification, the Authority intends to issue Airline Economics Event – New Delhi guidelines specifying the condition and processes by which an FC/FU undertaking ship A delegation from IFSCA participated in the second edition of India specific event organized by the leasing in IFSC may avail this facility as issued in case of aircraft leasing entities. Airline Economics on February 27-28, 2024, at New Delhi. Chief General Manager, IFSCA Issuance of Framework for Holding Companies presented the IFSCA aircraft leasing and tax framework and the holistic approach of IFSCA and Govt. of India with regards to developing GIFT IFSC as a hub for aircraft leasing. The discussions The framework would provide companies with an avenue to set up holding company in IFSC for were held on a wide array of topics relating to aircraft leasing and financing at GIFT IFSC. Several their overseas or domestic business expansion. This will enable Indian corporates and global bilateral meetings were also organized. corporates to strategize their investments overseas and investments in India respectively. Ship Leasing Policy enhancements in Aircraft and Shipping sector required to transform IFSC into a Financing Hub Marine Money India Ship Finance Forum Currently, IFSC has facilitated leasing of aircrafts and ships. However, in order to transform IFSC A delegation from the IFSCA participated in the inaugural edition of India specific event organized into an aircraft and ship financing hub, a number of tax and sectoral policy changes are required. by the Marine Money on February 20, 2024, at Mumbai. Chairperson, IFSCA delivered a keynote Detailed policy papers have been sent to Ministry of Finance, Shipping and Civil Aviation. address in which he appraised the participants about the opportunities available for ship leasing and financing at GIFT IFSC. Executive Director, IFSCA participated in the panel discussion to deliberate upon Ship Acquisition, Leasing and Financing at GIFT IFSC. Policies and programs for the following year Review of the Finance Company Regulations According to the IFSCA (Procedure for Making Regulations) Regulations, all regulations issued by the Authority must undergo a review every three years. Consequently, the FC Regulations and relevant circulars will be evaluated and appropriately modified/amended to facilitate the ease of doing business for entities. This review process will also entail making necessary amendments to circulars and frameworks in consultation with the industry. Enabling Finance Companies in IFSC to undertake investment in the form of Participating Interest Participating interest (PI) is a type of investment which grants investors a proportional ownership stake in a project, typically within the natural resource exploration sector, such as an oil and gas exploration block, or minerals etc. This type of investment provides stakeholders with a share in the assets/natural resources being explored and subsequently extracted. Facilitating PI may enable entities to engage in strategic investments in natural resource exploration and production, thereby potentially benefiting India's energy security. Enabling circulars related to 'Ship Leasing in IFSC' (i) Issuing clarifications regarding the nature of activities permissible for ship lessors in IFSC. Essentially, it will specify that ship leasing can be conducted by any entities that own ships or hold leasehold rights over ships or ocean vessels. (ii) The Ministry of Commerce and Industry vide Gazette Notification dated March 14, 2024, had amended rule 21B of the SEZ Rules 2006, to enable ship leasing unit in IFSC to utilise the office space or manpower or both of another unit in IFSC for the purpose of ship leasing, with the 28 292023-24 CAPITAL MARKETS This policy initiative offers Indian companies, especially start-ups and companies in the sunrise and technology sectors, an alternative avenue to access global capital beyond the domestic exchanges. This is expected to lead to better valuation of Indian companies in line with global standards of scale and performance, boost foreign investment flows, unlock growth opportunities The capital markets ecosystem in GIFT IFSC aims position India as a global financial hub by and broaden the investor base. providing a robust and efficient infrastructure which includes advanced international stock exchanges, robust clearing and settlement systems and a diverse range of financial products Public Indian companies will have the flexibility to access both markets i.e. domestic market for such as equities, debt instruments, and derivatives. Regulated by the International Financial raising capital in INR and the international market at the IFSC for raising capital in foreign Services Centres Authority (IFSCA), GIFT IFSC offers best-in-class regulatory framework, currency from the global investors. This initiative will particularly benefit Indian companies going streamlined processes, and attractive tax incentives to create a conducive environment for global and having ambitions to look at opportunities for expanding their presence in other global investors and financial entities across the globe. markets. It is also expected to provide a boost to the capital market ecosystem at GIFT IFSC by The capital market ecosystem in GIFT IFSC comprises of two International Stock Exchanges provision of new investment opportunities for investors, diversification of financial products and (India INX and NSE IFSC) offering 20+ hours of trading in various product categories including by enhancing liquidity. Index Derivatives, Equity Derivatives, Currency Derivatives, and Commodity Derivatives. The Incentives for foreign investors monthly turnover on IFSC Exchanges for the month of March 2024 was USD 79 Bn, and the average daily turnover of NIFTY Derivative contracts on NSE IX during the month of March For foreign investors, the Direct Listing scheme will allow them to participate in value creation in 2024 was USD 3.70 Bn. Indian companies facilitated by the world class and business friendly regulatory regime being GIFT IFSC has also become the preferred destination for Indian issuers looking for raising offered by the IFSC. global debt, including for green, social, sustainable and sustainability linked debt securities. The transactions on the stock exchanges in IFSC are in foreign currency, eliminating the currency The cumulative debt listings at GIFT IFSC stock exchanges as on March 2024 is USD 56.5 Bn of risk for the investors. The stock exchanges in IFSC have extended trading hours catering to which USD 12.3 Bn pertains to ESG labelled debt securities. The introduction of lower withholding tax (9%) on the exclusive debt listing at IFSC exchanges in Union budget 2023-24 investors of all significant jurisdictions in the world thereby providing convenience and ease of will further encourage more Indian issuers to raise global debt from GIFT IFSC. doing business. Additionally, there are various tax incentives provided under the Income Tax Act, 1961, making GIFT IFSC an attractive destination for global investors. IFSCA is already having a well-developed capital market ecosystem including stock exchanges, clearing corporations, depository, investing bankers, brokers, IBUs etc. GIFT IFSC is therefore well Policy/ Regulatory Developments positioned to act as the gateway for attracting untapped foreign capital into India and integrating India with the global financial system. Listing of Securities Direct Listing Scheme Box 1: Major features of the Direct Listing Scheme Eligibility Criteria for public Indian companies The Hon'ble Union Minister of Finance and Corporate Affairs Smt. Nirmala Sitharaman announced on July 28, 2023, the decision of Government of India to allow direct listing of equity shares of The eligibility criteria for a public Indian company to list its equity shares on an international public Indian Companies on the international exchanges in the IFSC. Pursuant to the exchange in the IFSC has been provided in the Direct Listing Scheme provided under FEM (NDI) announcement, the Government of India on January 24, 2024, notified the Foreign Exchange Rules, 2019 and the LEAP Rules. Management (Non-debt Instruments) Amendment Rules, 2024 and the Companies (Listing of Issue and Listing on International Exchanges: Equity Shares in Permissible Jurisdictions) Rules, 2024 (“LEAP Rules”) providing the framework for direct listing of equity shares by public Indian companies on the International Exchanges at A public Indian company may issue equity shares or offer equity shares of existing GIFT IFSC. The Direct Listing Scheme introduced in the FEM (NDI) Rules, 2019 provides an shareholders, subject to prohibited activities, and sectoral caps prescribed in paragraph 2 and overarching framework for issuing and listing of equity shares of public Indian companies on 3 of Schedule I of the FEM (NDI) Rules, 2019. international exchanges. Prior to this, Indian companies were not allowed to issue or list equity Further, equity shares listed in the IFSC shall be in dematerialized form and rank pari passu shares abroad. As of now, the framework allows unlisted public Indian companies to list their with equity shares listed on a recognised stock exchange in India. shares on an international exchange. 30 312023-24 CAPITAL MARKETS This policy initiative offers Indian companies, especially start-ups and companies in the sunrise and technology sectors, an alternative avenue to access global capital beyond the domestic exchanges. This is expected to lead to better valuation of Indian companies in line with global standards of scale and performance, boost foreign investment flows, unlock growth opportunities The capital markets ecosystem in GIFT IFSC aims position India as a global financial hub by and broaden the investor base. providing a robust and efficient infrastructure which includes advanced international stock exchanges, robust clearing and settlement systems and a diverse range of financial products Public Indian companies will have the flexibility to access both markets i.e. domestic market for such as equities, debt instruments, and derivatives. Regulated by the International Financial raising capital in INR and the international market at the IFSC for raising capital in foreign Services Centres Authority (IFSCA), GIFT IFSC offers best-in-class regulatory framework, currency from the global investors. This initiative will particularly benefit Indian companies going streamlined processes, and attractive tax incentives to create a conducive environment for global and having ambitions to look at opportunities for expanding their presence in other global investors and financial entities across the globe. markets. It is also expected to provide a boost to the capital market ecosystem at GIFT IFSC by The capital market ecosystem in GIFT IFSC comprises of two International Stock Exchanges provision of new investment opportunities for investors, diversification of financial products and (India INX and NSE IFSC) offering 20+ hours of trading in various product categories including by enhancing liquidity. Index Derivatives, Equity Derivatives, Currency Derivatives, and Commodity Derivatives. The Incentives for foreign investors monthly turnover on IFSC Exchanges for the month of March 2024 was USD 79 Bn, and the average daily turnover of NIFTY Derivative contracts on NSE IX during the month of March For foreign investors, the Direct Listing scheme will allow them to participate in value creation in 2024 was USD 3.70 Bn. Indian companies facilitated by the world class and business friendly regulatory regime being GIFT IFSC has also become the preferred destination for Indian issuers looking for raising offered by the IFSC. global debt, including for green, social, sustainable and sustainability linked debt securities. The transactions on the stock exchanges in IFSC are in foreign currency, eliminating the currency The cumulative debt listings at GIFT IFSC stock exchanges as on March 2024 is USD 56.5 Bn of risk for the investors. The stock exchanges in IFSC have extended trading hours catering to which USD 12.3 Bn pertains to ESG labelled debt securities. The introduction of lower withholding tax (9%) on the exclusive debt listing at IFSC exchanges in Union budget 2023-24 investors of all significant jurisdictions in the world thereby providing convenience and ease of will further encourage more Indian issuers to raise global debt from GIFT IFSC. doing business. Additionally, there are various tax incentives provided under the Income Tax Act, 1961, making GIFT IFSC an attractive destination for global investors. IFSCA is already having a well-developed capital market ecosystem including stock exchanges, clearing corporations, depository, investing bankers, brokers, IBUs etc. GIFT IFSC is therefore well Policy/ Regulatory Developments positioned to act as the gateway for attracting untapped foreign capital into India and integrating India with the global financial system. Listing of Securities Direct Listing Scheme Box 1: Major features of the Direct Listing Scheme Eligibility Criteria for public Indian companies The Hon'ble Union Minister of Finance and Corporate Affairs Smt. Nirmala Sitharaman announced on July 28, 2023, the decision of Government of India to allow direct listing of equity shares of The eligibility criteria for a public Indian company to list its equity shares on an international public Indian Companies on the international exchanges in the IFSC. Pursuant to the exchange in the IFSC has been provided in the Direct Listing Scheme provided under FEM (NDI) announcement, the Government of India on January 24, 2024, notified the Foreign Exchange Rules, 2019 and the LEAP Rules. Management (Non-debt Instruments) Amendment Rules, 2024 and the Companies (Listing of Issue and Listing on International Exchanges: Equity Shares in Permissible Jurisdictions) Rules, 2024 (“LEAP Rules”) providing the framework for direct listing of equity shares by public Indian companies on the International Exchanges at A public Indian company may issue equity shares or offer equity shares of existing GIFT IFSC. The Direct Listing Scheme introduced in the FEM (NDI) Rules, 2019 provides an shareholders, subject to prohibited activities, and sectoral caps prescribed in paragraph 2 and overarching framework for issuing and listing of equity shares of public Indian companies on 3 of Schedule I of the FEM (NDI) Rules, 2019. international exchanges. Prior to this, Indian companies were not allowed to issue or list equity Further, equity shares listed in the IFSC shall be in dematerialized form and rank pari passu shares abroad. As of now, the framework allows unlisted public Indian companies to list their with equity shares listed on a recognised stock exchange in India. shares on an international exchange. 30 312023-24 Permissible holders with clearing corporation and depository. It provides a trading platform for facilitating price discovery of the securities available for trading. Additionally, stock exchanges are also entrusted A non-resident person has only been permitted as permissible holder who can purchase or sell equity shares of a public Indian company listed on an international exchange in the IFSC. with various regulatory responsibilities for ensuring market integrity and for protecting investor Further, a permissible holder is permitted to purchase or sell equity shares of an Indian interests. company listed on an international exchange within the limit specified for foreign portfolio IFSCA grants recognition to stock exchanges under Regulation 9 of the IFSCA (Market investment under the FEM (NDI) Rules, 2019. Infrastructure Institutions) Regulations, 2021 (hereinafter referred to as MII Regulations). Pricing Currently there are two stock exchanges operating in GIFT IFSC, namely India International Exchange (IFSC) Limited (India INX) and NSE IFSC Limited (NSE IX). India INX is subsidiary of the In case of initial listing of equity shares by a public unlisted Indian company on the BSE Limited and NSE IX is the wholly owned subsidiary of National Stock Exchange of India International Exchange, the price of issue or transfer of equity shares shall be determined by a Limited. Both the stock exchanges are operational since 2017 and are being granted annual book-building process as permitted by the said International Exchange and shall not be less than the fair market value under applicable rules or regulations under the Foreign Exchange renewal of recognition under MII Regulations. Management Act, 1999. Co-location facility offered by the Stock Exchanges In case of an already listed Indian company, the equity shares shall be issued in the IFSC at a The Co-location facility is offered by the stock exchanges to eligible market participants such as price not less than the price applicable to a corresponding mode of issuance of such equity broker dealers and data vendors, whereby their trading or data-vending systems are allowed to be shares to domestic investors under the applicable laws. located within or at close proximity to the premises of the stock exchanges. Trading systems of such market participants are connected to the trading platform of the stock exchanges through IFSCA (Issuance and Listing of Securities) Regulations, 2021 direct and private network. Pursuant to the notification of Direct Listing Scheme, IFSCA issued a press release inviting for The stock exchange while facilitating co-location, are required to ensure that all eligible market suggestions from public and other stakeholders for reviewing the IFSCA (Issuance and Listing of participants who avail co-location facility have fair, transparent and equitable access to facilities Securities) Regulations, 2021, mainly with the purpose of promoting ease of doing business and and data feeds provided by the stock exchange. benchmarking the regulatory requirements with best practices in other global markets. As on March 31, 2024, IFSCA is in the process of reviewing the IFSCA (Issuance and Listing of Securities) The stock exchanges also have to permit direct connectivity between the co-location facility of a Regulations, 2021. recognised stock exchange in IFSC and the co-location facility of other recognized stock exchange in IFSC, India or overseas. Monitoring investments from countries sharing land border with India IFSCA issued a circular dated February 09, 2024 providing the mechanism to monitor investments BOX 2: GIFT Connect from countries sharing land border with India. It provides detailed requirements to monitor The GIFT Connect (formerly NSE IFSC-SGX Connect) is a mutual collaborative effort between the participation by such entities at the time of onboarding, primary market issuances, secondary National Stock Exchange of India and the Singapore Exchange. It was launched by the Hon'ble market trading, off-market transfers. It also requires the recognised stock exchanges in IFSC to Prime Minister of India on July 29, 2022. With India's economy projected to become the world's conduct market surveillance to monitor any trading activity by such identified clients in the third largest, the GIFT Connect presents an innovative pathway for international investors to secondary market and submit report to IFSCA on monthly basis. gain exposure to India capital market. Market Infrastructure Institutions The GIFT Connect unifies both international and domestic participants, creating a deeper liquidity pool, and an expanded shelf of Nifty products for investors. SGX has set up a subsidiary The stock exchanges, clearing corporations and depositories are classified as Market i.e., SGX India Connect IFSC Private Limited in GIFT IFSC to act as a pass-through entity for orders Infrastructure Institutions (MIIs). These institutions provide the necessary infrastructure for routed through SGX. facilitating trading, clearing and settlement of securities. As the nature of the functions performed Full-scale operations of GIFT Connect commenced from July 3, 2023, with USD 8.05 Bn open by the MIIs forms the backbone of the capital market in GIFT IFSC and hence are very critical, they interest in Nifty futures and over USD 1.04 Bn open interest in Nifty Options. Following the are subject to greater degrees of regulatory oversight. transition, all US dollar-denominated Nifty derivatives contracts are being exclusively traded on Stock Exchange NSE IX. The average daily turnover of NIFTY derivative contracts on NSE IX in March 2024 was USD 3.70 Bn. A stock exchange plays the central role in facilitating trading in securities in close coordination 32 332023-24 Permissible holders with clearing corporation and depository. It provides a trading platform for facilitating price discovery of the securities available for trading. Additionally, stock exchanges are also entrusted A non-resident person has only been permitted as permissible holder who can purchase or sell equity shares of a public Indian company listed on an international exchange in the IFSC. with various regulatory responsibilities for ensuring market integrity and for protecting investor Further, a permissible holder is permitted to purchase or sell equity shares of an Indian interests. company listed on an international exchange within the limit specified for foreign portfolio IFSCA grants recognition to stock exchanges under Regulation 9 of the IFSCA (Market investment under the FEM (NDI) Rules, 2019. Infrastructure Institutions) Regulations, 2021 (hereinafter referred to as MII Regulations). Pricing Currently there are two stock exchanges operating in GIFT IFSC, namely India International Exchange (IFSC) Limited (India INX) and NSE IFSC Limited (NSE IX). India INX is subsidiary of the In case of initial listing of equity shares by a public unlisted Indian company on the BSE Limited and NSE IX is the wholly owned subsidiary of National Stock Exchange of India International Exchange, the price of issue or transfer of equity shares shall be determined by a Limited. Both the stock exchanges are operational since 2017 and are being granted annual book-building process as permitted by the said International Exchange and shall not be less than the fair market value under applicable rules or regulations under the Foreign Exchange renewal of recognition under MII Regulations. Management Act, 1999. Co-location facility offered by the Stock Exchanges In case of an already listed Indian company, the equity shares shall be issued in the IFSC at a The Co-location facility is offered by the stock exchanges to eligible market participants such as price not less than the price applicable to a corresponding mode of issuance of such equity broker dealers and data vendors, whereby their trading or data-vending systems are allowed to be shares to domestic investors under the applicable laws. located within or at close proximity to the premises of the stock exchanges. Trading systems of such market participants are connected to the trading platform of the stock exchanges through IFSCA (Issuance and Listing of Securities) Regulations, 2021 direct and private network. Pursuant to the notification of Direct Listing Scheme, IFSCA issued a press release inviting for The stock exchange while facilitating co-location, are required to ensure that all eligible market suggestions from public and other stakeholders for reviewing the IFSCA (Issuance and Listing of participants who avail co-location facility have fair, transparent and equitable access to facilities Securities) Regulations, 2021, mainly with the purpose of promoting ease of doing business and and data feeds provided by the stock exchange. benchmarking the regulatory requirements with best practices in other global markets. As on March 31, 2024, IFSCA is in the process of reviewing the IFSCA (Issuance and Listing of Securities) The stock exchanges also have to permit direct connectivity between the co-location facility of a Regulations, 2021. recognised stock exchange in IFSC and the co-location facility of other recognized stock exchange in IFSC, India or overseas. Monitoring investments from countries sharing land border with India IFSCA issued a circular dated February 09, 2024 providing the mechanism to monitor investments BOX 2: GIFT Connect from countries sharing land border with India. It provides detailed requirements to monitor The GIFT Connect (formerly NSE IFSC-SGX Connect) is a mutual collaborative effort between the participation by such entities at the time of onboarding, primary market issuances, secondary National Stock Exchange of India and the Singapore Exchange. It was launched by the Hon'ble market trading, off-market transfers. It also requires the recognised stock exchanges in IFSC to Prime Minister of India on July 29, 2022. With India's economy projected to become the world's conduct market surveillance to monitor any trading activity by such identified clients in the third largest, the GIFT Connect presents an innovative pathway for international investors to secondary market and submit report to IFSCA on monthly basis. gain exposure to India capital market. Market Infrastructure Institutions The GIFT Connect unifies both international and domestic participants, creating a deeper liquidity pool, and an expanded shelf of Nifty products for investors. SGX has set up a subsidiary The stock exchanges, clearing corporations and depositories are classified as Market i.e., SGX India Connect IFSC Private Limited in GIFT IFSC to act as a pass-through entity for orders Infrastructure Institutions (MIIs). These institutions provide the necessary infrastructure for routed through SGX. facilitating trading, clearing and settlement of securities. As the nature of the functions performed Full-scale operations of GIFT Connect commenced from July 3, 2023, with USD 8.05 Bn open by the MIIs forms the backbone of the capital market in GIFT IFSC and hence are very critical, they interest in Nifty futures and over USD 1.04 Bn open interest in Nifty Options. Following the are subject to greater degrees of regulatory oversight. transition, all US dollar-denominated Nifty derivatives contracts are being exclusively traded on Stock Exchange NSE IX. The average daily turnover of NIFTY derivative contracts on NSE IX in March 2024 was USD 3.70 Bn. A stock exchange plays the central role in facilitating trading in securities in close coordination 32 332023-24 Table 9 : Broker dealers in IFSC (as on March 31, 2024) Following NIFTY contracts are available for trading for almost 21 hours in GIFT IFSC which overlaps Asia, Europe, and US trading hours. Stock Exchange No. of Brokers Dealers India INX 59 i. Nifty 50 Index Futures and Options ii. Bank Nifty Index Futures and Options NSE IX 67 iii. Nifty IT Index Futures and Options Source: India INX and NSE IX iv. Nifty Financial Services Index Futures and Options The GIFT Connect has given a boost to GIFT IFSC as a global hub for international financial Clearing Members products and services. It is a major step forward for India to be a 'price setter' of the financial A clearing member is an intermediary that is responsible for clearing and settlement of all trades world. executed by a broker dealer. Clearing Corporation Table 10 : Clearing members in IFSC (as on March 31, 2024) Clearing No. of Self No. of Trading Cum No. of Professional A clearing corporation is an MII that handles the clearing and settlement of transactions that are Corporation Clearing Members Clearing Members Clearing Members executed on the stock exchange. The clearing corporations fulfil the main obligation of ensuring that transactions are settled between counterparties in a prompt and efficient manner. India ICC 5 9 2 NICCL 7 11 2 There are two clearing corporations operational in GIFT IFSC namely, India International Clearing Source: India ICC and NICCL Corporation (IFSC) Limited (India ICC) and NSE IFSC Clearing Corporation Limited (NICCL). India ICC is subsidiary of BSE Limited and NICCL is the wholly owned subsidiary of NSE Clearing Status of operations at Disaster Recovery (DR) Site of the Broker Dealers and Clearing Limited. Both the clearing corporations are being granted annual renewal of recognition under Members MII Regulations. Broker dealers and clearing members are permitted to set up their DR Sites in India. DR sites Depository ensure that entities run their operations with minimal down time in case their primary location A depository is an organisation which holds securities (like shares, debentures, bonds etc.) of and systems fail due to an unforeseen event. IFSCA clarified that operations carried out by the investors in electronic form at the request of the investors through a registered depository broker dealers and clearing members, from their respective DR sites (located outside GIFT IFSC participant. India International Depository IFSC Limited (IIDI) is the sole depository functional in and within India) will be considered to have been carried out at GIFT IFSC. GIFT IFSC which acts as the record keeper of securities. Direct Market Access and Sponsored Access facilities Capital Market Intermediaries Broker dealers in IFSC are permitted to offer Direct Market Access (DMA) facility to their clients. The Capital Market Intermediaries (CMIs) are generally client-facing entities which assist issuing DMA facility allows broker dealers to offer their clients direct access to the trading system of the company and investors to perform various transactions in the capital market. Activities of CMIs in stock exchange, through the broker dealer's trading systems, without any manual intervention by IFSC are governed under IFSCA (Capital Market Intermediaries) Regulations, 2021. These the broker dealer. The broker dealer retains the ability to monitor internally and, if necessary, stop regulations have specified the regulatory framework for various types of intermediaries such as an order prior to it being executed. broker dealers, clearing members, depository participants, investment bankers, investment Additionally, in order to enhance market participation and broaden the investor base, broker advisers, custodians, distributors etc. dealers have been permitted to offer the facility of Sponsored Access (SA) to its clients. SA is a form Broker Dealers of DMA in which the broker dealer permits its client to transmit orders directly to the trading system of stock exchange without routing it through the broker dealer's trading system. Such an Broker dealers are entities which execute trades on their own account as well as on behalf of their arrangement facilitates low latency trading and assists in preserving the confidentiality of clients on the recognised stock exchanges in IFSC. sophisticated, proprietary trading strategies of the clients. The stock exchanges are required to identify and distinguish DMA/SA orders and trades from other orders and trades. The broker dealers are fully responsible and liable for all orders emanating through their DMA/SA systems of their clients. 34 352023-24 Table 9 : Broker dealers in IFSC (as on March 31, 2024) Following NIFTY contracts are available for trading for almost 21 hours in GIFT IFSC which overlaps Asia, Europe, and US trading hours. Stock Exchange No. of Brokers Dealers India INX 59 i. Nifty 50 Index Futures and Options ii. Bank Nifty Index Futures and Options NSE IX 67 iii. Nifty IT Index Futures and Options Source: India INX and NSE IX iv. Nifty Financial Services Index Futures and Options The GIFT Connect has given a boost to GIFT IFSC as a global hub for international financial Clearing Members products and services. It is a major step forward for India to be a 'price setter' of the financial A clearing member is an intermediary that is responsible for clearing and settlement of all trades world. executed by a broker dealer. Clearing Corporation Table 10 : Clearing members in IFSC (as on March 31, 2024) Clearing No. of Self No. of Trading Cum No. of Professional A clearing corporation is an MII that handles the clearing and settlement of transactions that are Corporation Clearing Members Clearing Members Clearing Members executed on the stock exchange. The clearing corporations fulfil the main obligation of ensuring that transactions are settled between counterparties in a prompt and efficient manner. India ICC 5 9 2 NICCL 7 11 2 There are two clearing corporations operational in GIFT IFSC namely, India International Clearing Source: India ICC and NICCL Corporation (IFSC) Limited (India ICC) and NSE IFSC Clearing Corporation Limited (NICCL). India ICC is subsidiary of BSE Limited and NICCL is the wholly owned subsidiary of NSE Clearing Status of operations at Disaster Recovery (DR) Site of the Broker Dealers and Clearing Limited. Both the clearing corporations are being granted annual renewal of recognition under Members MII Regulations. Broker dealers and clearing members are permitted to set up their DR Sites in India. DR sites Depository ensure that entities run their operations with minimal down time in case their primary location A depository is an organisation which holds securities (like shares, debentures, bonds etc.) of and systems fail due to an unforeseen event. IFSCA clarified that operations carried out by the investors in electronic form at the request of the investors through a registered depository broker dealers and clearing members, from their respective DR sites (located outside GIFT IFSC participant. India International Depository IFSC Limited (IIDI) is the sole depository functional in and within India) will be considered to have been carried out at GIFT IFSC. GIFT IFSC which acts as the record keeper of securities. Direct Market Access and Sponsored Access facilities Capital Market Intermediaries Broker dealers in IFSC are permitted to offer Direct Market Access (DMA) facility to their clients. The Capital Market Intermediaries (CMIs) are generally client-facing entities which assist issuing DMA facility allows broker dealers to offer their clients direct access to the trading system of the company and investors to perform various transactions in the capital market. Activities of CMIs in stock exchange, through the broker dealer's trading systems, without any manual intervention by IFSC are governed under IFSCA (Capital Market Intermediaries) Regulations, 2021. These the broker dealer. The broker dealer retains the ability to monitor internally and, if necessary, stop regulations have specified the regulatory framework for various types of intermediaries such as an order prior to it being executed. broker dealers, clearing members, depository participants, investment bankers, investment Additionally, in order to enhance market participation and broaden the investor base, broker advisers, custodians, distributors etc. dealers have been permitted to offer the facility of Sponsored Access (SA) to its clients. SA is a form Broker Dealers of DMA in which the broker dealer permits its client to transmit orders directly to the trading system of stock exchange without routing it through the broker dealer's trading system. Such an Broker dealers are entities which execute trades on their own account as well as on behalf of their arrangement facilitates low latency trading and assists in preserving the confidentiality of clients on the recognised stock exchanges in IFSC. sophisticated, proprietary trading strategies of the clients. The stock exchanges are required to identify and distinguish DMA/SA orders and trades from other orders and trades. The broker dealers are fully responsible and liable for all orders emanating through their DMA/SA systems of their clients. 34 352023-24 Settlement of Client's Funds lying with Broker Dealer Transaction/Processes/Operations/Trends Broker dealers in IFSC were required to transfer the unutilized funds back into client's account on Turnover on Stock Exchanges monthly/quarterly basis (as per choice of client). This requirement of settlement of funds by the broker dealers involves cost of remittance of funds across the jurisdictions. For the ease of doing The turnover (including value of premium in case of options) on the stock exchanges in IFSC business in IFSC, the requirement of monthly/quarterly settlement has been done away with and increased to USD 711 Bn during FY 2023-24 compared to USD 447 Bn of FY 2022-23 registering an settlement of funds is to be done as per the agreement between the client and broker dealer. The increase of 59%. stock exchanges are required to put in place a mechanism for monitoring client's funds lying with the broker dealers to avoid misutilization of funds. Figure 6 : Turnover of stock exchanges (USD Mn) Depository Participants A depository participant (DP) is a participant of a recognized depository and acts as an 800,000.00 intermediary between the depository and the investor. As on March 31, 2024, there are 10 DPs 700,000.00 registered with the Authority out of which 2 entities were granted registration during 2023-24. 600,000.00 Custodians 500,000.00 400,000.00 A custodian is a specialized financial institution that carries on the business of providing custodial 300,000.00 services in relation to financial products which include safekeeping of such financial products and 200,000.00 providing services incidental thereto. As on March 31, 2024, there are five custodians registered 100,000.00 with the Authority. - 2023-24 Investment Advisers India INX NSE IX Total Investment advisers play a pivotal role in IFSCs by providing valuable guidance, managing risks and helping investors achieve their financial objectives in a complex and dynamic financial landscape. As on March 31, 2024, there are four investment advisers registered with the Authority. Derivatives available for trading on Stock Exchanges Investment Bankers Index Derivatives Investment bankers play a vital role in facilitating capital formation, advising on strategic The most popular index derivatives on India INX are S&P BSE SENSEX & S&P BSE SENSEX 50. NSE transactions, managing risk exposure and facilitating cross-border transactions, and their IX offers trading in Futures and Options contracts on four Indices which are, NIFTY 50 Index, expertise and services are essential for the efficient functioning of global financial markets. The NIFTY BANK Index, NIFTY FINANCIAL Services Index and NIFTY IT Index. role of investment bankers is set to assume greater significance in the IFSC once the Direct Listing Scheme becomes operational. Index Futures: Turnover in index futures grew by 75% in 2023-24 compared to 2022-23. Further, IBUs in IFSC have been permitted (authorized) by IFSCA vide circular dated December 3, 2021, to undertake investment banking activities in IFSC, subject to certain conditions. As on Table 11 : No. of contracts and turnover in index futures March 31, 2024, there is one investment banker (registered) and two IBUs (authorized) to undertake investment banking activities in the IFSC. No of Contracts Turnover (USD Mn) Financial Year NSE IX NSE IX 2022-23 8,161,501 7,397,074 148,374 254,965 2023-24 1,242,244 16,678,005 24,905 680,920 Source: India INX and NSE IX 36 372023-24 Settlement of Client's Funds lying with Broker Dealer Transaction/Processes/Operations/Trends Broker dealers in IFSC were required to transfer the unutilized funds back into client's account on Turnover on Stock Exchanges monthly/quarterly basis (as per choice of client). This requirement of settlement of funds by the broker dealers involves cost of remittance of funds across the jurisdictions. For the ease of doing The turnover (including value of premium in case of options) on the stock exchanges in IFSC business in IFSC, the requirement of monthly/quarterly settlement has been done away with and increased to USD 711 Bn during FY 2023-24 compared to USD 447 Bn of FY 2022-23 registering an settlement of funds is to be done as per the agreement between the client and broker dealer. The increase of 59%. stock exchanges are required to put in place a mechanism for monitoring client's funds lying with the broker dealers to avoid misutilization of funds. Figure 6 : Turnover of stock exchanges (USD Mn) Depository Participants A depository participant (DP) is a participant of a recognized depository and acts as an 800,000.00 intermediary between the depository and the investor. As on March 31, 2024, there are 10 DPs 700,000.00 registered with the Authority out of which 2 entities were granted registration during 2023-24. 600,000.00 Custodians 500,000.00 400,000.00 A custodian is a specialized financial institution that carries on the business of providing custodial 300,000.00 services in relation to financial products which include safekeeping of such financial products and 200,000.00 providing services incidental thereto. As on March 31, 2024, there are five custodians registered 100,000.00 with the Authority. - 2023-24 Investment Advisers India INX NSE IX Total Investment advisers play a pivotal role in IFSCs by providing valuable guidance, managing risks and helping investors achieve their financial objectives in a complex and dynamic financial landscape. As on March 31, 2024, there are four investment advisers registered with the Authority. Derivatives available for trading on Stock Exchanges Investment Bankers Index Derivatives Investment bankers play a vital role in facilitating capital formation, advising on strategic The most popular index derivatives on India INX are S&P BSE SENSEX & S&P BSE SENSEX 50. NSE transactions, managing risk exposure and facilitating cross-border transactions, and their IX offers trading in Futures and Options contracts on four Indices which are, NIFTY 50 Index, expertise and services are essential for the efficient functioning of global financial markets. The NIFTY BANK Index, NIFTY FINANCIAL Services Index and NIFTY IT Index. role of investment bankers is set to assume greater significance in the IFSC once the Direct Listing Scheme becomes operational. Index Futures: Turnover in index futures grew by 75% in 2023-24 compared to 2022-23. Further, IBUs in IFSC have been permitted (authorized) by IFSCA vide circular dated December 3, 2021, to undertake investment banking activities in IFSC, subject to certain conditions. As on Table 11 : No. of contracts and turnover in index futures March 31, 2024, there is one investment banker (registered) and two IBUs (authorized) to undertake investment banking activities in the IFSC. No of Contracts Turnover (USD Mn) Financial Year NSE IX NSE IX 2022-23 8,161,501 7,397,074 148,374 254,965 2023-24 1,242,244 16,678,005 24,905 680,920 Source: India INX and NSE IX 36 372023-24 Index Options: Turnover in index options in 2023-24 as compared to 2022-23 has been as under: The turnover in currency derivatives in FY 2022-23 and FY 2023-24 has been as under: Table 12 : No. of contracts and premium turnover in index options Table 16: Turnover in currency derivatives No of Contracts Premium Turnover (USD Mn) Financial Year NSE IX NSE IX NSE IX NSE IX 2022-23 173,297,387 724,776 9,695 188 2022-23 133,711 26,007 1,662 645 2023-24 14,302,868 1,433,164 773 363 2023-24 36,481 19,731 444 480 Source: India INX and NSE IX Source: India INX & NSE IX Contract wise bifurcation of the turnover Commodity Derivatives Contract wise turnover on stock exchanges in FY 2022-23 and FY 2023-24 has been as under: There are various commodities derivatives available for trading on the stock exchanges as mentioned in the table below. Figure 7 : Turnover on stock exchanges in FY 2022-23 and FY 2023-24 (USD Mn) Table 13 : Commodities derivatives available for trading on the IFSC exchanges 800,000.00 Precious Metals Gold, Silver 700,000.00 600,000.00 Base Metals Copper, Aluminium, Lead, Nickel, Zinc 500,000.00 Energy Brent Crude Oil 400,000.00 300,000.00 The turnover in commodity derivatives for the Financial Year 2022-23 and Financial Year 2023-24 200,000.00 has been as under: 100,000.00 - Commodity Currency Index Index Table 14 : Turnover in commodity derivatives on India INX Total Futures Futures Futures Options 2022-23 2023-24 Financial Year No of Contracts Premium Turnover (USD Mn) 2022-23 552,439 31,632 Working Groups/ Committee 2023-24 45,343 2,901 Working Group on Direct Listing of Listed Indian Companies on IFSC Exchanges Source: India INX A Working Group was constituted by IFSCA in August 2023 for making recommendations for Currency Derivatives operationalising direct listing of equity shares of already listed Indian Companies. There are various currency derivatives available for trading on the stock exchanges as mentioned The Working Group, chaired by Mr. Praveen Trivedi, Executive Director, IFSCA with members from below: Ministry of Corporate Affairs, Department of Economic Affairs, Securities and Exchange Board of India and other market participants submitted its report to Chairperson, IFSCA on December 20, Table 15 : Currency Derivatives 2023. The Working Group studied the best practices for cross-border listing by companies in various Global Currency Derivatives EUR–USD, GBP–USD, JPY–USD, CHF–USD, AUD–USD jurisdictions. The Working Group, after extensive deliberations, recommended the various Rupee Derivatives INR-USD, USD–INR approaches for connecting the capital markets of India and IFSC for the proposed Direct Listing of Indian companies. The Working Group studied various regulatory and operational matters relating to dual listing of Indian companies. The recommendations are aimed at facilitating implementation of direct listing providing Indian companies a pathway to access global capital through IFSC. The final report is available on the IFSCA website and can be accessed here. 38 392023-24 Index Options: Turnover in index options in 2023-24 as compared to 2022-23 has been as under: The turnover in currency derivatives in FY 2022-23 and FY 2023-24 has been as under: Table 12 : No. of contracts and premium turnover in index options Table 16: Turnover in currency derivatives No of Contracts Premium Turnover (USD Mn) Financial Year NSE IX NSE IX NSE IX NSE IX 2022-23 173,297,387 724,776 9,695 188 2022-23 133,711 26,007 1,662 645 2023-24 14,302,868 1,433,164 773 363 2023-24 36,481 19,731 444 480 Source: India INX and NSE IX Source: India INX & NSE IX Contract wise bifurcation of the turnover Commodity Derivatives Contract wise turnover on stock exchanges in FY 2022-23 and FY 2023-24 has been as under: There are various commodities derivatives available for trading on the stock exchanges as mentioned in the table below. Figure 7 : Turnover on stock exchanges in FY 2022-23 and FY 2023-24 (USD Mn) Table 13 : Commodities derivatives available for trading on the IFSC exchanges 800,000.00 Precious Metals Gold, Silver 700,000.00 600,000.00 Base Metals Copper, Aluminium, Lead, Nickel, Zinc 500,000.00 Energy Brent Crude Oil 400,000.00 300,000.00 The turnover in commodity derivatives for the Financial Year 2022-23 and Financial Year 2023-24 200,000.00 has been as under: 100,000.00 - Commodity Currency Index Index Table 14 : Turnover in commodity derivatives on India INX Total Futures Futures Futures Options 2022-23 2023-24 Financial Year No of Contracts Premium Turnover (USD Mn) 2022-23 552,439 31,632 Working Groups/ Committee 2023-24 45,343 2,901 Working Group on Direct Listing of Listed Indian Companies on IFSC Exchanges Source: India INX A Working Group was constituted by IFSCA in August 2023 for making recommendations for Currency Derivatives operationalising direct listing of equity shares of already listed Indian Companies. There are various currency derivatives available for trading on the stock exchanges as mentioned The Working Group, chaired by Mr. Praveen Trivedi, Executive Director, IFSCA with members from below: Ministry of Corporate Affairs, Department of Economic Affairs, Securities and Exchange Board of India and other market participants submitted its report to Chairperson, IFSCA on December 20, Table 15 : Currency Derivatives 2023. The Working Group studied the best practices for cross-border listing by companies in various Global Currency Derivatives EUR–USD, GBP–USD, JPY–USD, CHF–USD, AUD–USD jurisdictions. The Working Group, after extensive deliberations, recommended the various Rupee Derivatives INR-USD, USD–INR approaches for connecting the capital markets of India and IFSC for the proposed Direct Listing of Indian companies. The Working Group studied various regulatory and operational matters relating to dual listing of Indian companies. The recommendations are aimed at facilitating implementation of direct listing providing Indian companies a pathway to access global capital through IFSC. The final report is available on the IFSCA website and can be accessed here. 38 392023-24 Standing Committee on Primary Markets Meeting with Monetary Authority of Singapore IFSCA constituted a Standing Committee on Primary Markets on February 23, 2024, chaired by Mr. Chairperson, IFSCA met with Mr. Lim Tuang Lee, Assistant Managing Director (Capital Markets), Shri Mohandas Pai. The committee shall advise IFSCA on (a) the various policy and regulatory Monetary Authority of Singapore in November 2023 and discussed potential areas for matters on a periodic basis to facilitate the development of a vibrant and robust ecosystem for collaboration. primary markets in the IFSC; (b) the roadmap and strategy for successful implementation of direct listing of public Indian companies on the stock exchanges in the IFSC; (c) introduction of new financial instruments for facilitating capital raising in the primary markets in the IFSC; (d) scaling up global debt market in the IFSC; and (e) matters relating to development and regulation of primary markets in the IFSC. Circulars/ Guidelines (i) Status of operations at Disaster Recovery (DR) Site of the Broker-Dealers and Clearing Members (May 09, 2023) (ii) Direct Market Access and Sponsored Access facilities (June 21, 2023) (iii) Co-location facility offered by the Stock Exchanges (June 23, 2023) (iv) Settlement of Client's Funds lying with Broker-Dealer (March 14, 2024) (v) Monitoring investments from countries sharing land border with India (February 09, 2024) (vi) Reporting Norms for Capital Market Intermediaries (February 08, 2024) Advocacy and Outreach Round Table discussions in Singapore An IFSCA delegation led by Chairperson, IFSCA had visited Singapore in November 2023. During Image 6 : Meeting of IFSCA and MAS the visit, Round Table discussions on following were organized: IOSCO Annual Meeting 2023 (i) Capital Markets in IFSC IFSCA participated in the IOSCO Annual Meeting 2023 held during June 12-16, 2023, at Bangkok, (ii) Fund management/ Wealth management in IFSC (iii) Ship Leasing in IFSC Thailand. As an associate member of IOSCO, the IFSCA delegation participated in the various meetings/ events of the IOSCO Annual Meeting, including Asia Pacific Regional Committee (APRC) These discussions were attended by the representatives of various prominent entities in meeting, Growth and Emerging Markets Committee Meeting, and Presidents' Committee Meeting. Singapore. The participants were informed about the business opportunities in GIFT IFSC under The IFSCA delegation also participated in the regulatory workshops that revolved around IFSCA's regulatory ecosystem. regulation of crypto markets, building healthy and efficient sustainable markets, enhancing market supervision and integrity through the use of SupTech and building a CCP (Central Counterparties) particularly in emerging markets. On the sidelines of the IOSCO Annual Meeting, the IFSCA delegation held bilateral meetings with securities market regulators of six jurisdictions. IOSCO EMMoU Due to challenges that come with the interconnectedness of financial markets and technological advancements, IOSCO established an Enhanced Multilateral Memorandum of Understanding ("IOSCO EMMoU") in the year 2016 to enhance cooperation and information sharing between securities regulators. The IOSCO EMMoU provides for cooperation with additional powers that IOSCO has identified as necessary to ensure continued effectiveness in safeguarding market integrity and stability, protecting investors and deterring misconduct and fraud. The IOSCO EMMoU provides for additional powers that are referred to as the “ACFIT” powers. It includes Image 5 : Chairperson, IFSCA with market participants during a Round Table in Singapore 40 412023-24 Standing Committee on Primary Markets Meeting with Monetary Authority of Singapore IFSCA constituted a Standing Committee on Primary Markets on February 23, 2024, chaired by Mr. Chairperson, IFSCA met with Mr. Lim Tuang Lee, Assistant Managing Director (Capital Markets), Shri Mohandas Pai. The committee shall advise IFSCA on (a) the various policy and regulatory Monetary Authority of Singapore in November 2023 and discussed potential areas for matters on a periodic basis to facilitate the development of a vibrant and robust ecosystem for collaboration. primary markets in the IFSC; (b) the roadmap and strategy for successful implementation of direct listing of public Indian companies on the stock exchanges in the IFSC; (c) introduction of new financial instruments for facilitating capital raising in the primary markets in the IFSC; (d) scaling up global debt market in the IFSC; and (e) matters relating to development and regulation of primary markets in the IFSC. Circulars/ Guidelines (i) Status of operations at Disaster Recovery (DR) Site of the Broker-Dealers and Clearing Members (May 09, 2023) (ii) Direct Market Access and Sponsored Access facilities (June 21, 2023) (iii) Co-location facility offered by the Stock Exchanges (June 23, 2023) (iv) Settlement of Client's Funds lying with Broker-Dealer (March 14, 2024) (v) Monitoring investments from countries sharing land border with India (February 09, 2024) (vi) Reporting Norms for Capital Market Intermediaries (February 08, 2024) Advocacy and Outreach Round Table discussions in Singapore An IFSCA delegation led by Chairperson, IFSCA had visited Singapore in November 2023. During Image 6 : Meeting of IFSCA and MAS the visit, Round Table discussions on following were organized: IOSCO Annual Meeting 2023 (i) Capital Markets in IFSC IFSCA participated in the IOSCO Annual Meeting 2023 held during June 12-16, 2023, at Bangkok, (ii) Fund management/ Wealth management in IFSC (iii) Ship Leasing in IFSC Thailand. As an associate member of IOSCO, the IFSCA delegation participated in the various meetings/ events of the IOSCO Annual Meeting, including Asia Pacific Regional Committee (APRC) These discussions were attended by the representatives of various prominent entities in meeting, Growth and Emerging Markets Committee Meeting, and Presidents' Committee Meeting. Singapore. The participants were informed about the business opportunities in GIFT IFSC under The IFSCA delegation also participated in the regulatory workshops that revolved around IFSCA's regulatory ecosystem. regulation of crypto markets, building healthy and efficient sustainable markets, enhancing market supervision and integrity through the use of SupTech and building a CCP (Central Counterparties) particularly in emerging markets. On the sidelines of the IOSCO Annual Meeting, the IFSCA delegation held bilateral meetings with securities market regulators of six jurisdictions. IOSCO EMMoU Due to challenges that come with the interconnectedness of financial markets and technological advancements, IOSCO established an Enhanced Multilateral Memorandum of Understanding ("IOSCO EMMoU") in the year 2016 to enhance cooperation and information sharing between securities regulators. The IOSCO EMMoU provides for cooperation with additional powers that IOSCO has identified as necessary to ensure continued effectiveness in safeguarding market integrity and stability, protecting investors and deterring misconduct and fraud. The IOSCO EMMoU provides for additional powers that are referred to as the “ACFIT” powers. It includes Image 5 : Chairperson, IFSCA with market participants during a Round Table in Singapore 40 412023-24 powers to obtain and share audit work papers, review financial statements, compel physical undertaken by IFSCA on sustainable finance were highlighted. Reporting requirements with attendance for testimony, freeze assets and obtain existing internet service provider (ISP) and respect to ESG labelled bonds, ESG funds and sustainability lending by IFSC Banking Units in GIFT telephone records. IFSC were discussed. During the year, IFSCA has applied for becoming a signatory to the IOSCO EMMoU. Roundtable Discussion with Investment Bankers (October 12, 2023) IOSCO World Investor Week 2023 IFSCA hosted a roundtable discussion with Investment Bankers on the topic – “Opportunities at GIFT IFSC”. Mr. Praveen Trivedi, Executive Director and other senior officials from IFSCA The World Investor Week (WIW) is a week-long global campaign promoted by IOSCO to raise participated in the virtual roundtable. The discussion revolved around the role and significance of awareness about the importance of investor education and protection and to highlight the various investment bankers for facilitating (a) Direct listing of equity shares of Indian companies on IFSC initiatives of securities regulators across the world in this regard. exchanges; and (b) Listing of ESG Labelled Bonds in order to establish GIFT IFSC as a gateway for As a member of IOSCO, IFSCA celebrated the World Investor Week 2023 on the theme related to channelizing foreign capital into India. sustainable finance and investor resilience, during the week starting October 09, 2023. The two stock exchanges at GIFT IFSC actively took part in the celebrations in co-ordination with IFSCA. A Social Media Campaign (October 09-13, 2023) series of events and activities were organized as part of the celebrations that included a statement As part of the IOSCO World Investor Week,2023, IFSCA used its social media platform, especially by Chairperson, IFSCA, opening bell ringing ceremony, webinars/roundtable discussions, twitter (X) and LinkedIn to generate awareness about smart investing in sustainable finance. This outreach to students and brokers, social media campaign and closing bell ceremony. was done through posting messages relating to ESG investing, socially responsible investing, Details of the various events conducted as part of IOSCO World Investor Week 2023 are as follows: impact investing, greenwashing etc. Various events and programs conducted as part of the World Investor Week,2023 were also posted on the social media platforms by IFSCA and the stock Statement by Chairperson, IFSCA exchanges at IFSC. As part of the IOSCO World Investor Week, 2023 Shri. K. Rajaraman, Chairperson, IFSCA issued a Closing Bell Ceremony hosted by India International Exchange Limited (October 13, statement emphasising on the importance and significance of sustainable finance. In his 2023) statement, he mentioned the various initiatives taken by IFSCA to emerge as global hub for green and sustainable finance and highlighted the various investment opportunities at GIFT City. The closing bell ceremony for the World Investor Week, 2023 was hosted by India International Exchange Limited. Mr. Praveen Trivedi, Executive Director, IFSCA was the Guest of Honour of the Opening Bell Ringing Ceremony hosted by NSE International Exchange IFSC Limited event wherein many officials from IFSCA also participated. During the event, Mr. Praveen Trivedi (October 09,2023) stressed the importance of protecting the interests of investors in the development of the international financial ecosystem at GIFT IFSC. To commence the celebrations of the IOSCO World Investor Week, 2023 at GIFT IFSC, a virtual webinar was organized by NSE International Exchange IFSC Limited (NSE IX) on the topic “GIFT IFSC: A Gateway to Global Capital Market”, wherein Dr. Dipesh Shah, Executive Director, IFSCA participated in a webinar as the Guest of Honour. During the event, the growth and development of the capital market ecosystem at GIFT IFSC was highlighted and all the stakeholders were called upon to make GIFT IFSC as a preferred destination for listing of Indian and foreign companies. Webinar organized by BSE Brokers' Forum (October 10, 2023) A webinar entitled “India Investor Show 2023" was organised by BSE Brokers' Forum which had representatives from IFSCA, SEBI, BSE Brokers' Forum, stock exchanges at IFSC and other stakeholders. The various investment opportunities through the GIFT IFSC for NRIs, Foreign nationals and for resident Indians in global markets through GIFT City were discussed including the Direct Listing Scheme. IFSCA officials also provided information about the overall development of the capital markets ecosystem at GIFT IFSC including the various products and services, such as fund management activities, GIFT NIFTY Derivatives, ESG labelled bonds and investment opportunities for resident Indians in global markets via IFSC based stock exchanges. Webinar hosted by NSE IX (October 11, 2023) IFSCA officials participated in a webinar on “Importance of sustainability reporting” as part of Image 7 : Mr. Praveen Trivedi, Executive Director of IFSCA and Mr. Saurabh Shah, Corporate Advisor ring the World Investor Week, 2023 hosted by NSE IX. During the event, various regulatory initiatives closing bell ceremony of the IOSCO World Investor Week, 2023 hosted by India INX 42 432023-24 powers to obtain and share audit work papers, review financial statements, compel physical undertaken by IFSCA on sustainable finance were highlighted. Reporting requirements with attendance for testimony, freeze assets and obtain existing internet service provider (ISP) and respect to ESG labelled bonds, ESG funds and sustainability lending by IFSC Banking Units in GIFT telephone records. IFSC were discussed. During the year, IFSCA has applied for becoming a signatory to the IOSCO EMMoU. Roundtable Discussion with Investment Bankers (October 12, 2023) IOSCO World Investor Week 2023 IFSCA hosted a roundtable discussion with Investment Bankers on the topic – “Opportunities at GIFT IFSC”. Mr. Praveen Trivedi, Executive Director and other senior officials from IFSCA The World Investor Week (WIW) is a week-long global campaign promoted by IOSCO to raise participated in the virtual roundtable. The discussion revolved around the role and significance of awareness about the importance of investor education and protection and to highlight the various investment bankers for facilitating (a) Direct listing of equity shares of Indian companies on IFSC initiatives of securities regulators across the world in this regard. exchanges; and (b) Listing of ESG Labelled Bonds in order to establish GIFT IFSC as a gateway for As a member of IOSCO, IFSCA celebrated the World Investor Week 2023 on the theme related to channelizing foreign capital into India. sustainable finance and investor resilience, during the week starting October 09, 2023. The two stock exchanges at GIFT IFSC actively took part in the celebrations in co-ordination with IFSCA. A Social Media Campaign (October 09-13, 2023) series of events and activities were organized as part of the celebrations that included a statement As part of the IOSCO World Investor Week,2023, IFSCA used its social media platform, especially by Chairperson, IFSCA, opening bell ringing ceremony, webinars/roundtable discussions, twitter (X) and LinkedIn to generate awareness about smart investing in sustainable finance. This outreach to students and brokers, social media campaign and closing bell ceremony. was done through posting messages relating to ESG investing, socially responsible investing, Details of the various events conducted as part of IOSCO World Investor Week 2023 are as follows: impact investing, greenwashing etc. Various events and programs conducted as part of the World Investor Week,2023 were also posted on the social media platforms by IFSCA and the stock Statement by Chairperson, IFSCA exchanges at IFSC. As part of the IOSCO World Investor Week, 2023 Shri. K. Rajaraman, Chairperson, IFSCA issued a Closing Bell Ceremony hosted by India International Exchange Limited (October 13, statement emphasising on the importance and significance of sustainable finance. In his 2023) statement, he mentioned the various initiatives taken by IFSCA to emerge as global hub for green and sustainable finance and highlighted the various investment opportunities at GIFT City. The closing bell ceremony for the World Investor Week, 2023 was hosted by India International Exchange Limited. Mr. Praveen Trivedi, Executive Director, IFSCA was the Guest of Honour of the Opening Bell Ringing Ceremony hosted by NSE International Exchange IFSC Limited event wherein many officials from IFSCA also participated. During the event, Mr. Praveen Trivedi (October 09,2023) stressed the importance of protecting the interests of investors in the development of the international financial ecosystem at GIFT IFSC. To commence the celebrations of the IOSCO World Investor Week, 2023 at GIFT IFSC, a virtual webinar was organized by NSE International Exchange IFSC Limited (NSE IX) on the topic “GIFT IFSC: A Gateway to Global Capital Market”, wherein Dr. Dipesh Shah, Executive Director, IFSCA participated in a webinar as the Guest of Honour. During the event, the growth and development of the capital market ecosystem at GIFT IFSC was highlighted and all the stakeholders were called upon to make GIFT IFSC as a preferred destination for listing of Indian and foreign companies. Webinar organized by BSE Brokers' Forum (October 10, 2023) A webinar entitled “India Investor Show 2023" was organised by BSE Brokers' Forum which had representatives from IFSCA, SEBI, BSE Brokers' Forum, stock exchanges at IFSC and other stakeholders. The various investment opportunities through the GIFT IFSC for NRIs, Foreign nationals and for resident Indians in global markets through GIFT City were discussed including the Direct Listing Scheme. IFSCA officials also provided information about the overall development of the capital markets ecosystem at GIFT IFSC including the various products and services, such as fund management activities, GIFT NIFTY Derivatives, ESG labelled bonds and investment opportunities for resident Indians in global markets via IFSC based stock exchanges. Webinar hosted by NSE IX (October 11, 2023) IFSCA officials participated in a webinar on “Importance of sustainability reporting” as part of Image 7 : Mr. Praveen Trivedi, Executive Director of IFSCA and Mr. Saurabh Shah, Corporate Advisor ring the World Investor Week, 2023 hosted by NSE IX. During the event, various regulatory initiatives closing bell ceremony of the IOSCO World Investor Week, 2023 hosted by India INX 42 432023-24 IFSCA's participation in the IOSCO World Investor Week 2023, in coordination with the stock exchanges in GIFT IFSC on the theme related to sustainable finance and investor resilience played an important role in generating awareness about various developments relating to sustainable finance and the various opportunities for investors in GIFT IFSC. Policy and Programmes for the Following Year New IFSCA (Listing) Regulations, 2024 Considering that several suggestions have been received for amendments in the IFSCA (Issuance and Listing of Securities) Regulations, 2021 it has been decided that the extant (Issuance and Listing of Securities) Regulations, 2021 may be replaced with the new IFSCA (Listing) Regulations, 2024. The new IFSCA (Listing) Regulations, 2024 is expected to be notified next year. The proposed new IFSCA (Listing) Regulations, 2024 is expected to promote ease of doing business for the issuers, both domestic and foreign, to access capital market through listing of securities on the stock exchanges in the IFSC. The issuers will be able to access capital with greater flexibility and efficiency. The regulations are expected to give a fillip to the primary market activities in the IFSC, across various financial instruments. New regulations on Takeovers and Buybacks IFSCA will be reviewing the regulatory requirements for takeovers and buybacks of equity shares of companies listed on the recognised stock exchanges in the IFSC. The purpose is to benchmark the regulatory requirements with the international best practices. New regulations on prohibition of market abuse IFSCA will be reviewing the regulatory requirements for prohibition of insider trading and prohibition of fraudulent and unfair trade practices in the securities market in the IFSC. The purpose is to benchmark the regulatory requirements with the international best practices. Review of IFSCA (Capital Market Intermediaries) Regulations, 2021 In terms of IFSCA (Procedure for making regulations) Regulations, 2021, IFSCA is required to review the regulations every three years. Accordingly, IFSCA (Capital Market Intermediaries) Regulations, 2021 will be reviewed in the next year (2024-25). 442023-24 IFSCA's participation in the IOSCO World Investor Week 2023, in coordination with the stock exchanges in GIFT IFSC on the theme related to sustainable finance and investor resilience played an important role in generating awareness about various developments relating to sustainable finance and the various opportunities for investors in GIFT IFSC. Policy and Programmes for the Following Year New IFSCA (Listing) Regulations, 2024 Considering that several suggestions have been received for amendments in the IFSCA (Issuance and Listing of Securities) Regulations, 2021 it has been decided that the extant (Issuance and Listing of Securities) Regulations, 2021 may be replaced with the new IFSCA (Listing) Regulations, 2024. The new IFSCA (Listing) Regulations, 2024 is expected to be notified next year. The proposed new IFSCA (Listing) Regulations, 2024 is expected to promote ease of doing business for the issuers, both domestic and foreign, to access capital market through listing of securities on the stock exchanges in the IFSC. The issuers will be able to access capital with greater flexibility and efficiency. The regulations are expected to give a fillip to the primary market activities in the IFSC, across various financial instruments. New regulations on Takeovers and Buybacks IFSCA will be reviewing the regulatory requirements for takeovers and buybacks of equity shares of companies listed on the recognised stock exchanges in the IFSC. The purpose is to benchmark the regulatory requirements with the international best practices. New regulations on prohibition of market abuse IFSCA will be reviewing the regulatory requirements for prohibition of insider trading and prohibition of fraudulent and unfair trade practices in the securities market in the IFSC. The purpose is to benchmark the regulatory requirements with the international best practices. Review of IFSCA (Capital Market Intermediaries) Regulations, 2021 In terms of IFSCA (Procedure for making regulations) Regulations, 2021, IFSCA is required to review the regulations every three years. Accordingly, IFSCA (Capital Market Intermediaries) Regulations, 2021 will be reviewed in the next year (2024-25). 442023-24 Policy/ Regulatory Developments FUND MANAGEMENT Framework for Accredited Investors in IFSC A robust Fund Management industry along with a well-developed supporting ecosystem is IFSCA (Fund Management) Regulations, 2022 provide certain flexibilities to the "Accredited pivotal to the growth of capital markets. With a view to develop GIFT IFSC as a preferred Investors" and the FMEs that deal with them. Therefore, in line with the global best practices, jurisdiction for global fund management industry, IFSCA notified the Fund Management IFSCA has laid down the framework for eligibility of such investors and the modalities of their Regulations in April 2022, which came into effect in May 2022. The Regulations have adopted accreditation. global best practices and facilitate innovation and promote ease of doing business in IFSC. Box 3: Regulatory Framework for Accredited Investors in IFSC Earlier, pooling of global capital for investments into India was predominantly undertaken In several international financial centres, the financial sector regulators provide certain through funds set up in overseas financial jurisdictions. In the short span of time since these flexibility to such investors who are deemed to be better aware of and have the financial regulations have come into effect, GIFT IFSC is emerging as a preferred jurisdiction for pooling wherewithal to withstand the risks emergent from their investments, and also extend certain global funds for investments into India as well as overseas, on account of best-in-class flexibilities to such market participants which deal with such investors. regulatory architecture and competitive tax regime. IFSCA has laid down a detailed framework for Accredited Investors, which, inter alia, includes The Fund Management ecosystem is growing rapidly and comprises of 104 Fund Management the eligibility criteria for such investors and the modalities of accreditation. The framework is Entities, 115 Alternative Investment Funds (AIFs), and the total investment made by AIFs in modelled around the globally benchmarked processes for accreditation, eligibility criteria for IFSC being USD 3.7 Bn as of March 2024. Further, 11 schemes have been redomiciled to GIFT different types of investors, such as Individuals, HUFs, Partnership firms, Body Corporate, IFSC from different foreign jurisdictions, which is a testimony of the industry acceptance of the Trusts, etc., and permits a defined set of entities to be deemed as Accredited Investors by virtue regulatory and tax regime for investment funds in GIFT IFSC. of their special status. The framework also lays down certain responsibilities for the regulated entities that onboard The IFSCA (Fund Management) Regulations, 2022 provide for unified registration to the Fund Accredited Investors and provides a mechanism to investors to opt-in / opt-out of the Management Entity (FME) and permit them to undertake a host of fund management activities, accreditation. such as managing retail schemes (including Exchange Traded Funds), non-retail schemes The extant IFSCA (Fund Management) Regulations, 2022, provide following flexibilities for (Alternative Investment Funds), investment trusts (Real Estate Investment Trusts and "Accredited Investors" and FMEs dealing with them: Infrastructure Investment Trusts), Portfolio Management Services, etc. (i) No Minimum Investment Threshold: Accredited Investors are exempt from the The regulations establish three categories for FMEs: minimum investment thresholds for Venture Capital Schemes, Restricted Schemes, and (i) Registered FME (Retail): These FMEs can serve both retail and non-retail investors, offering a Portfolio Management Services, allowing them to invest without entry threshold. variety of fund management products and services, such as retail schemes (including Exchange (ii) Exemption from 'Skin in the Game' Contribution: For Venture Capital Schemes and Traded Funds), non-retail schemes (Alternative Investment Funds), Venture Capital Schemes, Restricted Schemes where 2/3 of investors are Accredited Investors, FMEs and their Portfolio Management Services, etc. associates are not required to contribute to the scheme. This exemption removes the need (ii) Registered FME (Non-Retail): These FMEs cater to accredited investors or those investing at for the 'skin in the game' contribution, which typically ensures the FME's interests align least USD 150,000, with lower eligibility requirements compared to retail FMEs. with those of the investors. (iii) Authorized FME: This special category, with light-touch registration requirements, targets Further, the regulatory framework for Distributors of capital market products and services, FMEs investing only in unlisted start-up securities through Venture Capital Schemes, exclusively specified vide Circular dated December 21, 2022, under IFSCA (Capital Market Intermediaries) serving accredited investors or those investing at least USD 250,000. Regulations, 2021, also makes a reference to “Accredited Investors” and enables distribution of a The categories, based on the risk potential of permitted activities, also dictate the initial and wider bouquet of products and services to such investors as compared to other investors. ongoing regulatory requirements. Detailed eligibility and regulatory requirements for various schemes and services are specified under the regulations. 46 472023-24 Policy/ Regulatory Developments FUND MANAGEMENT Framework for Accredited Investors in IFSC A robust Fund Management industry along with a well-developed supporting ecosystem is IFSCA (Fund Management) Regulations, 2022 provide certain flexibilities to the "Accredited pivotal to the growth of capital markets. With a view to develop GIFT IFSC as a preferred Investors" and the FMEs that deal with them. Therefore, in line with the global best practices, jurisdiction for global fund management industry, IFSCA notified the Fund Management IFSCA has laid down the framework for eligibility of such investors and the modalities of their Regulations in April 2022, which came into effect in May 2022. The Regulations have adopted accreditation. global best practices and facilitate innovation and promote ease of doing business in IFSC. Box 3: Regulatory Framework for Accredited Investors in IFSC Earlier, pooling of global capital for investments into India was predominantly undertaken In several international financial centres, the financial sector regulators provide certain through funds set up in overseas financial jurisdictions. In the short span of time since these flexibility to such investors who are deemed to be better aware of and have the financial regulations have come into effect, GIFT IFSC is emerging as a preferred jurisdiction for pooling wherewithal to withstand the risks emergent from their investments, and also extend certain global funds for investments into India as well as overseas, on account of best-in-class flexibilities to such market participants which deal with such investors. regulatory architecture and competitive tax regime. IFSCA has laid down a detailed framework for Accredited Investors, which, inter alia, includes The Fund Management ecosystem is growing rapidly and comprises of 104 Fund Management the eligibility criteria for such investors and the modalities of accreditation. The framework is Entities, 115 Alternative Investment Funds (AIFs), and the total investment made by AIFs in modelled around the globally benchmarked processes for accreditation, eligibility criteria for IFSC being USD 3.7 Bn as of March 2024. Further, 11 schemes have been redomiciled to GIFT different types of investors, such as Individuals, HUFs, Partnership firms, Body Corporate, IFSC from different foreign jurisdictions, which is a testimony of the industry acceptance of the Trusts, etc., and permits a defined set of entities to be deemed as Accredited Investors by virtue regulatory and tax regime for investment funds in GIFT IFSC. of their special status. The framework also lays down certain responsibilities for the regulated entities that onboard The IFSCA (Fund Management) Regulations, 2022 provide for unified registration to the Fund Accredited Investors and provides a mechanism to investors to opt-in / opt-out of the Management Entity (FME) and permit them to undertake a host of fund management activities, accreditation. such as managing retail schemes (including Exchange Traded Funds), non-retail schemes The extant IFSCA (Fund Management) Regulations, 2022, provide following flexibilities for (Alternative Investment Funds), investment trusts (Real Estate Investment Trusts and "Accredited Investors" and FMEs dealing with them: Infrastructure Investment Trusts), Portfolio Management Services, etc. (i) No Minimum Investment Threshold: Accredited Investors are exempt from the The regulations establish three categories for FMEs: minimum investment thresholds for Venture Capital Schemes, Restricted Schemes, and (i) Registered FME (Retail): These FMEs can serve both retail and non-retail investors, offering a Portfolio Management Services, allowing them to invest without entry threshold. variety of fund management products and services, such as retail schemes (including Exchange (ii) Exemption from 'Skin in the Game' Contribution: For Venture Capital Schemes and Traded Funds), non-retail schemes (Alternative Investment Funds), Venture Capital Schemes, Restricted Schemes where 2/3 of investors are Accredited Investors, FMEs and their Portfolio Management Services, etc. associates are not required to contribute to the scheme. This exemption removes the need (ii) Registered FME (Non-Retail): These FMEs cater to accredited investors or those investing at for the 'skin in the game' contribution, which typically ensures the FME's interests align least USD 150,000, with lower eligibility requirements compared to retail FMEs. with those of the investors. (iii) Authorized FME: This special category, with light-touch registration requirements, targets Further, the regulatory framework for Distributors of capital market products and services, FMEs investing only in unlisted start-up securities through Venture Capital Schemes, exclusively specified vide Circular dated December 21, 2022, under IFSCA (Capital Market Intermediaries) serving accredited investors or those investing at least USD 250,000. Regulations, 2021, also makes a reference to “Accredited Investors” and enables distribution of a The categories, based on the risk potential of permitted activities, also dictate the initial and wider bouquet of products and services to such investors as compared to other investors. ongoing regulatory requirements. Detailed eligibility and regulatory requirements for various schemes and services are specified under the regulations. 46 472023-24 Table 18 : Investment by Fund Management Schemes Supervision of Fund Management Entities Offsite Supervision Details regarding Schemes (As on March 31, 2024) In USD Mn To ensure that the pace of growth of fund management activities in GIFT IFSC is supported by a Schemes Authorised Investment Made healthy culture of compliance, IFSCA has laid down the framework for offsite supervision of FMEs Venture Capital Schemes 11 19.71 by specifying reporting norms for FMEs. The reports, required to be submitted on quarterly basis, of which, Angel Schemes 4 4.07 includes submission of quantitative information about the fund management operations and a Restricted Schemes 104 3676.3 duly signed compliance report from the officials of the FME. of which, Category I & II AIFs 41 2,467.78 Onsite Supervision of which, Category III AIFs 63 1208.52 IFSCA carried out onsite visits of 3 Fund Management Entities during FY 2023-24. As a result of Total Schemes in IFSC 115 3696.01 this exercise, Advisory Letters were issued to 2 Fund Management Entities. Facilitating Sovereign Wealth Funds to set up FMEs in GIFT IFSC Portfolio Management Services In order to facilitate sovereign wealth funds to set up their FMEs in GIFT IFSC for management of The IFSCA (Fund Management) Regulations, 2022 provide that FMEs which are registered under their own assets, a clarification was issued by IFSCA to remove certain difficulties faced by such the categories of Registered (Retail) and Registered (Non-Retail) may also provide Portfolio funds given their unique nature and mandate. Subsequently, a large Sovereign Wealth Fund has Management Services. The details are provided below: obtained IFSCA's approval to set up its FME in GIFT IFSC to manage its portfolio of investments into India. Table 19 : FMEs providing PMS Further, in order to position GIFT IFSC as an attractive jurisdiction for such Funds, IFSCA issued another clarification to dispense with certain regulatory restrictions which lead to difficulties for Number of FMEs providing PMS Assets Under Management (USD Mn) such funds. 18 1045 Net Worth of Fund Management Entities With a view to sensitize the FMEs about the importance of maintaining adequate capital and to Advocacy and Outreach disincentivize behaviour which may lead to fall in net worth, certain business restrictions regarding onboarding of new clients and undertaking new activities have been imposed in such cases where a FME's net worth falls below the threshold prescribed in the Regulations. In order to create awareness about the regulatory regime and the scope of opportunity for fund management related activities available in GIFT IFSC, IFSCA undertook several measures for Transaction/Processes/Operations/Trends outreach to the fund management and allied industries, as illustrated below: Roundtable discussion with Asset Management Companies of Mutual Funds and As on March 31, 2024, there are 104 FMEs registered with IFSCA, wherein the largest number of Wealth Managers in India registrations have been observed in the Registered FME (Non-Retail) category. The FMEs collectively target to raise USD 33.5 Bn across different types of schemes permitted under the IFSCA organized roundtable discussions with leading Asset Management Companies of Mutual IFSCA (Fund Management) Regulations, 2022. Funds and Wealth Managers in India on January 05, 2024, to apprise them about the opportunities Number of registered FMEs and Investment made by Fund Management Schemes are provided in fund management and distribution activities at IFSC, while also seeking their feedback on the below: regulatory regime laid down by IFSCA for these activities. Table 17 : Number of registered FMEs Roundtable discussion with Senior Management of large global funds An exclusive roundtable was organized with the senior officials of IFSCA in Mumbai on October 19, FME Registrations As on March 31, 2024 2023, with senior leaders from global investment funds. Chairperson, IFSCA along with senior Total Number of FMEs 104 officials of IFSCA held discussions on the wide array of fund management related opportunities of which, No. of Registered FME (Retail) 5 available at GIFT IFSC. Important suggestions towards further growth of the industry were also of which, No. of Registered FME (Non-Retail) 92 discussed. of which, No. of Authorised FME 7 48 492023-24 Table 18 : Investment by Fund Management Schemes Supervision of Fund Management Entities Offsite Supervision Details regarding Schemes (As on March 31, 2024) In USD Mn To ensure that the pace of growth of fund management activities in GIFT IFSC is supported by a Schemes Authorised Investment Made healthy culture of compliance, IFSCA has laid down the framework for offsite supervision of FMEs Venture Capital Schemes 11 19.71 by specifying reporting norms for FMEs. The reports, required to be submitted on quarterly basis, of which, Angel Schemes 4 4.07 includes submission of quantitative information about the fund management operations and a Restricted Schemes 104 3676.3 duly signed compliance report from the officials of the FME. of which, Category I & II AIFs 41 2,467.78 Onsite Supervision of which, Category III AIFs 63 1208.52 IFSCA carried out onsite visits of 3 Fund Management Entities during FY 2023-24. As a result of Total Schemes in IFSC 115 3696.01 this exercise, Advisory Letters were issued to 2 Fund Management Entities. Facilitating Sovereign Wealth Funds to set up FMEs in GIFT IFSC Portfolio Management Services In order to facilitate sovereign wealth funds to set up their FMEs in GIFT IFSC for management of The IFSCA (Fund Management) Regulations, 2022 provide that FMEs which are registered under their own assets, a clarification was issued by IFSCA to remove certain difficulties faced by such the categories of Registered (Retail) and Registered (Non-Retail) may also provide Portfolio funds given their unique nature and mandate. Subsequently, a large Sovereign Wealth Fund has Management Services. The details are provided below: obtained IFSCA's approval to set up its FME in GIFT IFSC to manage its portfolio of investments into India. Table 19 : FMEs providing PMS Further, in order to position GIFT IFSC as an attractive jurisdiction for such Funds, IFSCA issued another clarification to dispense with certain regulatory restrictions which lead to difficulties for Number of FMEs providing PMS Assets Under Management (USD Mn) such funds. 18 1045 Net Worth of Fund Management Entities With a view to sensitize the FMEs about the importance of maintaining adequate capital and to Advocacy and Outreach disincentivize behaviour which may lead to fall in net worth, certain business restrictions regarding onboarding of new clients and undertaking new activities have been imposed in such cases where a FME's net worth falls below the threshold prescribed in the Regulations. In order to create awareness about the regulatory regime and the scope of opportunity for fund management related activities available in GIFT IFSC, IFSCA undertook several measures for Transaction/Processes/Operations/Trends outreach to the fund management and allied industries, as illustrated below: Roundtable discussion with Asset Management Companies of Mutual Funds and As on March 31, 2024, there are 104 FMEs registered with IFSCA, wherein the largest number of Wealth Managers in India registrations have been observed in the Registered FME (Non-Retail) category. The FMEs collectively target to raise USD 33.5 Bn across different types of schemes permitted under the IFSCA organized roundtable discussions with leading Asset Management Companies of Mutual IFSCA (Fund Management) Regulations, 2022. Funds and Wealth Managers in India on January 05, 2024, to apprise them about the opportunities Number of registered FMEs and Investment made by Fund Management Schemes are provided in fund management and distribution activities at IFSC, while also seeking their feedback on the below: regulatory regime laid down by IFSCA for these activities. Table 17 : Number of registered FMEs Roundtable discussion with Senior Management of large global funds An exclusive roundtable was organized with the senior officials of IFSCA in Mumbai on October 19, FME Registrations As on March 31, 2024 2023, with senior leaders from global investment funds. Chairperson, IFSCA along with senior Total Number of FMEs 104 officials of IFSCA held discussions on the wide array of fund management related opportunities of which, No. of Registered FME (Retail) 5 available at GIFT IFSC. Important suggestions towards further growth of the industry were also of which, No. of Registered FME (Non-Retail) 92 discussed. of which, No. of Authorised FME 7 48 492023-24 IVCA Private Credit Summit 2023 Chairperson, IFSCA addressed the participants in IVCA Private Credit Summit 2023 on December 06, 2023. While apprising the participants about the growth and opportunities for private credit funds at IFSC, Chairperson, IFSCA also emphasized the importance of GIFT IFSC as the gateway to channelize capital flows into India. Image 8 : Chairperson, IFSCA, presiding the roundtable discussion with large global funds IVCA Conclave 2024 A delegation from IFSCA participated in the IVCA Conclave 2024 organised by Indian Venture and Alternate Capital Association (IVCA) on February 26 - 27, 2024. Shri Pradeep Ramakrishnan, Executive Director, IFSCA, participated in a fireside chat session where he briefed the participants about the regulatory landscape of IFSC, opportunities and offerings available for the funds industry at GIFT IFSC. He emphasized on the potential ease of doing business that would result from the upcoming single window clearance facility, direct listing opportunity for Indian startups on stock exchanges in GIFT IFSC and various initiatives taken by IFSCA in the area of sustainable finance. Image 10 : Chairperson, IFSCA addressing the audience during IVCA Private Credit Summit 2023 Policies and programs for the following year Reviewing the framework for Distributors of Capital Market Products & Services The Circular issued by IFSCA on December 21, 2022, in this subject restricts the Distributors from accepting remuneration from their clients and they are expected to charge the issuers or service providers whose products or services, respectively, they distribute. A review of this restriction shall be undertaken, particularly in the light of foreign practices and the feedback received from the market participants. Review of IFSCA (Fund Management) Regulations, 2022 The Regulations will be reviewed during the year, primarily with the focus of enhancing ease of doing business and based on the experience gained in last 2 years towards implementation of the Regulations. Image 9 : Shri Pradeep Ramakrishnan, Executive Director, with other dignitaries during IVCA Conclave 2024 50 512023-24 IVCA Private Credit Summit 2023 Chairperson, IFSCA addressed the participants in IVCA Private Credit Summit 2023 on December 06, 2023. While apprising the participants about the growth and opportunities for private credit funds at IFSC, Chairperson, IFSCA also emphasized the importance of GIFT IFSC as the gateway to channelize capital flows into India. Image 8 : Chairperson, IFSCA, presiding the roundtable discussion with large global funds IVCA Conclave 2024 A delegation from IFSCA participated in the IVCA Conclave 2024 organised by Indian Venture and Alternate Capital Association (IVCA) on February 26 - 27, 2024. Shri Pradeep Ramakrishnan, Executive Director, IFSCA, participated in a fireside chat session where he briefed the participants about the regulatory landscape of IFSC, opportunities and offerings available for the funds industry at GIFT IFSC. He emphasized on the potential ease of doing business that would result from the upcoming single window clearance facility, direct listing opportunity for Indian startups on stock exchanges in GIFT IFSC and various initiatives taken by IFSCA in the area of sustainable finance. Image 10 : Chairperson, IFSCA addressing the audience during IVCA Private Credit Summit 2023 Policies and programs for the following year Reviewing the framework for Distributors of Capital Market Products & Services The Circular issued by IFSCA on December 21, 2022, in this subject restricts the Distributors from accepting remuneration from their clients and they are expected to charge the issuers or service providers whose products or services, respectively, they distribute. A review of this restriction shall be undertaken, particularly in the light of foreign practices and the feedback received from the market participants. Review of IFSCA (Fund Management) Regulations, 2022 The Regulations will be reviewed during the year, primarily with the focus of enhancing ease of doing business and based on the experience gained in last 2 years towards implementation of the Regulations. Image 9 : Shri Pradeep Ramakrishnan, Executive Director, with other dignitaries during IVCA Conclave 2024 50 512023-24 METALS AND COMMODITIES Policy/ Regulatory Developments India International Bullion Exchange India, being one of the largest gold importers and consumers, is poised to enhance its role in the IIBX is promoted by India's leading market infrastructure institutions like NSE, India INX, India global precious metals market through the establishment of the International Bullion ICC, NSDL, CDSL and MCX and is regulated by IFSCA. The role of IIBX is to provide a transparent Exchange at GIFT IFSC. This initiative originated from the NITI Aayog's 2018 report on electronic trading platform for metal and commodities trading in IFSC, democratic pricing transforming India's gold market and was announced in the 2020 Union Budget. mechanism, greater integration with other segments of financial market, become a price The IFSCA formalized regulations for the Bullion Exchange in December 2020, leading to the influencer in the international market. etc. creation of the India International Bullion Exchange (IIBX) by a consortium of five major During the Financial Year 7,928.20 Kgs of gold and 908,800 Kgs of silver were imported through Market Infrastructure Institutions (MIIs) in India and the GIFT IFSC. IIBX was formally IIBX. launched by the Hon'ble Prime Minister on July 29, 2022. The idea behind IIBX is to create a vibrant marketplace and to develop a transparent Exchange model to determine the price of Products on IIBX various metals and commodities within the country, including precious metal such as gold, The following spot products are available on IIBX: silver etc, thus making India a price setter rather than a price taker in the global market. As of March 2024, IFSCA has granted registration to 5 entities as Bullion Trading Member Table 20 : Spot Products available on IIBX (Gold) (Bullion TM), 6 entities as Bullion Trading and Clearing member (Bullion TMCM), 2 entities as Bullion Professional Clearing Member (Bullion PCM) and 3 entities as Bullion Trading Member Gold cum Self Clearing Member. Further, 118 Qualified Jewellers and 82 Valid India UAE CEPA TRQ Description Holders have been notified by IFSCA. Three internationally recognized vault managers have Product Trading Unit Purity Good Delivery Standard established vaults in GIFT IFSC with capacity of 420 tonnes for Gold and 2200 tonnes for Silver. GOLD 995 T+0 1 Kg 995 LBMA GOLD MINI 999 T+0 100 grams 999 LBMA India is one of the largest importers and consumers of Gold and, thus, aims to be a significant price UAEGD GOLD 995 T+0 (*) 1 Kg 995 UAE Good Delivery (UAEGD) influencer in the global gold market. Total gold imported in India in CY 2023 was 862 tonnes UAEGD GOLD 999 T+0 (*) 100 grams 999 UAE Good Delivery (UAEGD) including Dore imports of 220.9 tonnes. This is an increase of 16% over CY 2022 when 741.1 (*) The abovementioned UAEGD Gold 995 purity and UAEGD Gold 999 purity products have also been extended to Tariff Rate Quota (TRQ) holders for the tonnes of gold (including 249 tonnes of Dore) was imported in India. The demand for gold as purpose of imports under India-UAE Comprehensive Economic Partnership Agreement (CEPA). Suitable and adequate safeguards have been put in place to witnessed by various sectors constituted jewellery wherein the demand in India dropped by 6 per ensure that the conditions, such as the requirement of Certificate of Origin from UAE’s Ministry of Economy, specified under the India-UAE CEPA are complied with by the sellers and the buyers. Only TRQ holders can import UAEGD TRQ GOLD within the pre-approved quota allotted by the DGFT. cent to 562.3 tonnes in 2023, compared to 600.6 tonnes in the previous year, total gold investment demand in the country grew by 7 per cent to 185.2 tonnes, compared to 173.6 tonnes in the Table 21 : Spot Products available on IIBX (Silver) previous year. ⁷¹ India has a huge demand for Silver as well and is the world's largest silver consumer. With the Silver Indian government's focus on renewable energy and electric vehicles, the demand for Silver in the Description coming years is expected to continue and grow further. Other factors such as rising disposable Product Trading Unit Purity Good Delivery Standard income, awareness for silver as an investment instrument, etc. may also lead to an increased demand for silver. SILVER Grains T+0 20 Kg 999 LBMA UAEGD SILVER Grains T+0 20 Kg 999 UAE Good Delivery (UAEGD) With such huge demand for gold and silver in the country, the formation of an India International UAEGDCEPA SILVER Grains T+0 20 Kg 999 UAE Good Delivery (UAEGD) Bullion Exchange IFSC Limited (IIBX) is one of the steps which provide opportunities for SILVER Bar T+0 30 Kg 999 LBMA formalization of the gold and silver import/trade in India through the model of Exchange, which provides a more transparent, democratic, and efficient platform for import/trade. Further, the UAEGD SILVER Bar T+0 30 Kg 999 UAE Good Delivery (UAEGD) Authority also aims to introduce more commodity-related products and derivatives thereon on the exchanges in the GIFT IFSC. ⁷¹ WGC Report for CY 2023 available on www.gold.org 52 532023-24 METALS AND COMMODITIES Policy/ Regulatory Developments India International Bullion Exchange India, being one of the largest gold importers and consumers, is poised to enhance its role in the IIBX is promoted by India's leading market infrastructure institutions like NSE, India INX, India global precious metals market through the establishment of the International Bullion ICC, NSDL, CDSL and MCX and is regulated by IFSCA. The role of IIBX is to provide a transparent Exchange at GIFT IFSC. This initiative originated from the NITI Aayog's 2018 report on electronic trading platform for metal and commodities trading in IFSC, democratic pricing transforming India's gold market and was announced in the 2020 Union Budget. mechanism, greater integration with other segments of financial market, become a price The IFSCA formalized regulations for the Bullion Exchange in December 2020, leading to the influencer in the international market. etc. creation of the India International Bullion Exchange (IIBX) by a consortium of five major During the Financial Year 7,928.20 Kgs of gold and 908,800 Kgs of silver were imported through Market Infrastructure Institutions (MIIs) in India and the GIFT IFSC. IIBX was formally IIBX. launched by the Hon'ble Prime Minister on July 29, 2022. The idea behind IIBX is to create a vibrant marketplace and to develop a transparent Exchange model to determine the price of Products on IIBX various metals and commodities within the country, including precious metal such as gold, The following spot products are available on IIBX: silver etc, thus making India a price setter rather than a price taker in the global market. As of March 2024, IFSCA has granted registration to 5 entities as Bullion Trading Member Table 20 : Spot Products available on IIBX (Gold) (Bullion TM), 6 entities as Bullion Trading and Clearing member (Bullion TMCM), 2 entities as Bullion Professional Clearing Member (Bullion PCM) and 3 entities as Bullion Trading Member Gold cum Self Clearing Member. Further, 118 Qualified Jewellers and 82 Valid India UAE CEPA TRQ Description Holders have been notified by IFSCA. Three internationally recognized vault managers have Product Trading Unit Purity Good Delivery Standard established vaults in GIFT IFSC with capacity of 420 tonnes for Gold and 2200 tonnes for Silver. GOLD 995 T+0 1 Kg 995 LBMA GOLD MINI 999 T+0 100 grams 999 LBMA India is one of the largest importers and consumers of Gold and, thus, aims to be a significant price UAEGD GOLD 995 T+0 (*) 1 Kg 995 UAE Good Delivery (UAEGD) influencer in the global gold market. Total gold imported in India in CY 2023 was 862 tonnes UAEGD GOLD 999 T+0 (*) 100 grams 999 UAE Good Delivery (UAEGD) including Dore imports of 220.9 tonnes. This is an increase of 16% over CY 2022 when 741.1 (*) The abovementioned UAEGD Gold 995 purity and UAEGD Gold 999 purity products have also been extended to Tariff Rate Quota (TRQ) holders for the tonnes of gold (including 249 tonnes of Dore) was imported in India. The demand for gold as purpose of imports under India-UAE Comprehensive Economic Partnership Agreement (CEPA). Suitable and adequate safeguards have been put in place to witnessed by various sectors constituted jewellery wherein the demand in India dropped by 6 per ensure that the conditions, such as the requirement of Certificate of Origin from UAE’s Ministry of Economy, specified under the India-UAE CEPA are complied with by the sellers and the buyers. Only TRQ holders can import UAEGD TRQ GOLD within the pre-approved quota allotted by the DGFT. cent to 562.3 tonnes in 2023, compared to 600.6 tonnes in the previous year, total gold investment demand in the country grew by 7 per cent to 185.2 tonnes, compared to 173.6 tonnes in the Table 21 : Spot Products available on IIBX (Silver) previous year. ⁷¹ India has a huge demand for Silver as well and is the world's largest silver consumer. With the Silver Indian government's focus on renewable energy and electric vehicles, the demand for Silver in the Description coming years is expected to continue and grow further. Other factors such as rising disposable Product Trading Unit Purity Good Delivery Standard income, awareness for silver as an investment instrument, etc. may also lead to an increased demand for silver. SILVER Grains T+0 20 Kg 999 LBMA UAEGD SILVER Grains T+0 20 Kg 999 UAE Good Delivery (UAEGD) With such huge demand for gold and silver in the country, the formation of an India International UAEGDCEPA SILVER Grains T+0 20 Kg 999 UAE Good Delivery (UAEGD) Bullion Exchange IFSC Limited (IIBX) is one of the steps which provide opportunities for SILVER Bar T+0 30 Kg 999 LBMA formalization of the gold and silver import/trade in India through the model of Exchange, which provides a more transparent, democratic, and efficient platform for import/trade. Further, the UAEGD SILVER Bar T+0 30 Kg 999 UAE Good Delivery (UAEGD) Authority also aims to introduce more commodity-related products and derivatives thereon on the exchanges in the GIFT IFSC. ⁷¹ WGC Report for CY 2023 available on www.gold.org 52 532023-24 Figure 8 : Bullion Market Ecosystem in IFSC Bullion Market Intermediaries The Authority has enabled the Trading Members (TMs) and Clearing Members (CMs) from the existing Exchanges at IFSC to be eligible to be grandfathered as members of the Bullion Exchange Bullion Exchange and Bullion Clearing Corporation (IIBX). In addition to the grandfathered members, new members Depository and CC (IIBX) are also registered as Bullion TM/CM of the IIBX. (IIDI) The number of the Bullion Market Intermediaries registered in the capacity of Bullion Trading member (Bullion TM), Bullion Trading and Clearing member (Bullion TCM), Bullion Trading cum Valid Self Clearing Member (Bullion TSCM) and Bullion Professional Clearing member (Bullion PCM) as India-UAE Bullion Market CEPA TRQ on March 31, 2024, is given below. The names and details of these entities are available on the Ecosystem Vault Holders in IFSC Managers website of the Authority. Table 22 : Registered Bullion Market Intermediaries at GIFT IFSC Qualified Jewellers and Qualified Bullion Market Suppliers Intermediaries 5 6 3 2 Qualified Jewellers The Directorate General of Foreign Trade (DGFT), Ministry of Commerce & Industry vide its Notification No.49/2015-2020 dated January 05, 2022, had, inter alia, specified that Qualified Exchange and Clearing Corporation Jewellers (QJs) notified by IFSCA shall be permitted to import gold under ITC(HS) Codes IIBX is an IFSCA registered Market Infrastructure Institution operating as a Bullion Exchange and 71081200 and 71189000, through India International Bullion Exchange IFSC Limited (“IIBX”). Bullion Clearing Corporation. Currently, as a Bullion Exchange, it provides platform that offers Based on the DGFT notification, IFSCA issued a Circular on January 19, 2022, specifying, inter alia, trading in products related to bullion (gold and silver). Its role as a Clearing Corporation is to act as the eligibility conditions for notifying an entity as a Qualified Jeweller. Qualified Jewellers are a central counter party for clearing and settlement of all the trade executed on the Bullion resident entities can undertake imports of bullion through IIBX provided that they fulfil the Exchange. criteria laid down in the aforementioned IFSCA Circular and notified by IFSCA. Depository Further, vide its Notification in October 2023, DGFT amended the import policy condition for silver to permit import by QJs under ITC (HS) Codes 71069110 and 71069290. GIFT IFSC has a single depository named India International Depository IFSC Ltd (IIDI) (previously known as CDSL IFSC Ltd) which has also been designated as a Bullion Depository. The As of March 31, 2024, IFSCA has notified 118 Qualified Jewellers, the details of which are available role of IIDI is to perform the function of issuance of Bullion Depository Receipts in electronic form on the website of the Authority. for trading on the Bullion Exchange. It also performs the function of overseeing the storage and Valid India-UAE CEPA TRQ Holders safeguarding of bullion through the vault managers. Further, as a bullion depository, IIDI also India and UAE have signed a Comprehensive Economic Partnership Agreement on February 18, ensures that the vault manager has the systems, mechanism, and related IT infrastructure to 2022, which, inter alia, promotes bilateral trade in bullion, and gems and jewellery sectors. Under provide encrypted transmission of information to the bullion depository and system-based the India-UAE CEPA, India can import a certain quantity of gold (Tariff Rate Quota) from the reconciliation of data between the vault manager and bullion depository. eligible UAE entities every year with customs duty 1% lower than the prevailing rate. The said TRQ Vaulting Infrastructure is allocated to eligible Indian entities (India-UAE CEPA TRQ holders) by DGFT at the start of Financial Year. The vaulting infrastructure in GIFT IFSC includes facilities for the storage of the bullion. Currently, 3 Vault Managers namely Sequel Logistics Private Limited, Brinks India Private Limited and Malca- With a view to facilitate imports by India-UAE CEPA TRQ holders through IIBX, DGFT amended the Amit JK Logistics Pvt. Ltd. have been registered by the Authority. The total capacity of the vaults in import policy condition for ITC(HS) Code 71081200 of Chapter 71 of ITC(HS) 2022, Schedule -I the GIFT IFSC is 420 tonnes of gold and 2,200 tonnes of silver. (Import Policy) stating that valid India-UAE TRQ holders as notified by IFSCA can import gold through IIBX against the TRQ and can obtain physical delivery of the same through IFSCA 54 552023-24 Figure 8 : Bullion Market Ecosystem in IFSC Bullion Market Intermediaries The Authority has enabled the Trading Members (TMs) and Clearing Members (CMs) from the existing Exchanges at IFSC to be eligible to be grandfathered as members of the Bullion Exchange Bullion Exchange and Bullion Clearing Corporation (IIBX). In addition to the grandfathered members, new members Depository and CC (IIBX) are also registered as Bullion TM/CM of the IIBX. (IIDI) The number of the Bullion Market Intermediaries registered in the capacity of Bullion Trading member (Bullion TM), Bullion Trading and Clearing member (Bullion TCM), Bullion Trading cum Valid Self Clearing Member (Bullion TSCM) and Bullion Professional Clearing member (Bullion PCM) as India-UAE Bullion Market CEPA TRQ on March 31, 2024, is given below. The names and details of these entities are available on the Ecosystem Vault Holders in IFSC Managers website of the Authority. Table 22 : Registered Bullion Market Intermediaries at GIFT IFSC Qualified Jewellers and Qualified Bullion Market Suppliers Intermediaries 5 6 3 2 Qualified Jewellers The Directorate General of Foreign Trade (DGFT), Ministry of Commerce & Industry vide its Notification No.49/2015-2020 dated January 05, 2022, had, inter alia, specified that Qualified Exchange and Clearing Corporation Jewellers (QJs) notified by IFSCA shall be permitted to import gold under ITC(HS) Codes IIBX is an IFSCA registered Market Infrastructure Institution operating as a Bullion Exchange and 71081200 and 71189000, through India International Bullion Exchange IFSC Limited (“IIBX”). Bullion Clearing Corporation. Currently, as a Bullion Exchange, it provides platform that offers Based on the DGFT notification, IFSCA issued a Circular on January 19, 2022, specifying, inter alia, trading in products related to bullion (gold and silver). Its role as a Clearing Corporation is to act as the eligibility conditions for notifying an entity as a Qualified Jeweller. Qualified Jewellers are a central counter party for clearing and settlement of all the trade executed on the Bullion resident entities can undertake imports of bullion through IIBX provided that they fulfil the Exchange. criteria laid down in the aforementioned IFSCA Circular and notified by IFSCA. Depository Further, vide its Notification in October 2023, DGFT amended the import policy condition for silver to permit import by QJs under ITC (HS) Codes 71069110 and 71069290. GIFT IFSC has a single depository named India International Depository IFSC Ltd (IIDI) (previously known as CDSL IFSC Ltd) which has also been designated as a Bullion Depository. The As of March 31, 2024, IFSCA has notified 118 Qualified Jewellers, the details of which are available role of IIDI is to perform the function of issuance of Bullion Depository Receipts in electronic form on the website of the Authority. for trading on the Bullion Exchange. It also performs the function of overseeing the storage and Valid India-UAE CEPA TRQ Holders safeguarding of bullion through the vault managers. Further, as a bullion depository, IIDI also India and UAE have signed a Comprehensive Economic Partnership Agreement on February 18, ensures that the vault manager has the systems, mechanism, and related IT infrastructure to 2022, which, inter alia, promotes bilateral trade in bullion, and gems and jewellery sectors. Under provide encrypted transmission of information to the bullion depository and system-based the India-UAE CEPA, India can import a certain quantity of gold (Tariff Rate Quota) from the reconciliation of data between the vault manager and bullion depository. eligible UAE entities every year with customs duty 1% lower than the prevailing rate. The said TRQ Vaulting Infrastructure is allocated to eligible Indian entities (India-UAE CEPA TRQ holders) by DGFT at the start of Financial Year. The vaulting infrastructure in GIFT IFSC includes facilities for the storage of the bullion. Currently, 3 Vault Managers namely Sequel Logistics Private Limited, Brinks India Private Limited and Malca- With a view to facilitate imports by India-UAE CEPA TRQ holders through IIBX, DGFT amended the Amit JK Logistics Pvt. Ltd. have been registered by the Authority. The total capacity of the vaults in import policy condition for ITC(HS) Code 71081200 of Chapter 71 of ITC(HS) 2022, Schedule -I the GIFT IFSC is 420 tonnes of gold and 2,200 tonnes of silver. (Import Policy) stating that valid India-UAE TRQ holders as notified by IFSCA can import gold through IIBX against the TRQ and can obtain physical delivery of the same through IFSCA 54 552023-24 registered vaults located in SEZs as per the guidelines prescribed by the IFSCA. Subsequently, Import of UAEGD Gold through IIBX by valid India-UAE TRQ holders (December 13, IFSCA issued a circular on December 13, 2023, to facilitate the participation of India-UAE CEPA 2023) TRQ Holders on the IIBX for import of UAE Good Delivery (UAEGD) TRQ Gold under the India-UAE Subsequent to the DGFT notification No.44/2023 dated November 20, 2023, permitting valid CEPA. India UAE TRQ Holders as notified by IFSCA to import gold through IIBX against the TRQ, this Further, RBI vide circular dated January 31, 2024, provided the guidelines on import of gold by Circular permitted the valid holders of India - UAE Tariff Rate Quota (TRQ) license / authorisation TRQ Holders under the India UAE CEPA as notified by IFSCA to all the Category-I Authorised Dealer as allotted by DGFT to be eligible to apply for being notified as 'India-UAE TRQ holders' by the Banks. During FY 2023-24, IFSCA notified 82 valid India UAE CEPA TRQ Holders. IFSCA. After being notified by the IFSCA, such valid India-UAE TRQ holders have been permitted to participate on IIBX, through Bullion Trading Members, for transacting in ('buying' only) UAEGD Major Developments/Operations gold for import under the India-UAE CEPA, subject to the quota, and other applicable terms and (i) The Office of Development Commissioner, GIFT SEZ (Ministry of Commerce and Industry), conditions. through public notice no. 01/2023-24 dated May 11, 2023, intimated about the launch of the Bullion Trading Members and Clearing Members in GIFT- IFSC (February 22, 2024) Indian Custom EDI System- ICES/ICEGATE for imports and exports at GIFT Multi Services SEZ, Gandhinagar, Gujarat. In continuation to the IFSCA circular dated August 07, 2023, this Circular extended the initial 6- month period (from the date of operationalization of Bullion Exchange) for maintaining the Net (ii) IIBX implemented every 30 minutes settlement of Bullion Depository Receipts (BDRs) for pre- Worth and Base Minimum Capital specified in the paragraph 3 and 4 of the IFSCA Circular F.No. funded T+0 contracts and direct pay-outs of BDRs to Clients/ SCCs for pre-funded T+0 329/IFSCA/Bullion MIIs/2021 dated September 17, 2021, by an additional period of 6 months i.e., contracts. till July 28, 2024. (iii) IIBX implemented Multiple Fund settlement cycles for T+0 contracts (3 cycles per day) for funds pay-out for the T+0 contracts traded on IIBX with effect from March 11, 2024. Notifications/Circular/Guidelines issued by other Circulars/ Guidelines issued by the Authority agencies relevant to the Bullion Ecosystem in IFSC Bullion Trading Members and Clearing Members in IFSC (August 07, 2023) (i) DGFT vide Notification No. 35/2023 dated October 11, 2023, amended the import policy condition for silver to permit import by QJs under ITC (HS) Codes 71069110 and 71069290. In continuation to the IFSCA circular dated January 27, 2023, this circular extended the initial 6- month period (from the date of operationalization of Bullion Exchange) for maintaining the Net (ii) RBI vide circular RBI/2023-2024/83 A.P. (DIR Series) Circular No. 07 dated November 10, Worth and Base Minimum Capital specified in the paragraph 3 and 4 of the IFSCA Circular F.No. 2023, provided guidelines to all the Category-I Authorised Dealer Banks on import of silver by 329/IFSCA/Bullion MIIs/2021 dated September 17, 2021, by an additional period of 6 months i.e., Qualified Jewellers as notified by IFSCA. till January 28, 2024. (iii) DGFT vide notification no. 44/2023 dated November 20, 2023, amended the import policy condition of gold under HS code 71081200 permitting the valid India-UAE TRQ holders as Import of gold and silver by Qualified Jewellers through India International Bullion notified by IFSCA to import gold through IIBX against the TRQ and taking physical delivery of Exchange (December 11, 2023) the same through IFSCA registered vaults located in SEZs as per the guidelines prescribed by A consolidated circular was issued for the purposes of import of gold and silver by eligible entities the IFSCA. as Qualified Jewellers, to transact on IIBX as clients of Bullion Trading Members or as 'Special (iv) RBI vide circular RBI/2023-24/118 A.P. (DIR Series) Circular No.14 dated January 31, 2024, Category' Clients (SCC) under ITC(HS) codes 7106, 7108, 7113, 7114 and 7118 under Chapter 71 provided the guidelines to all the Category-I Authorised Dealer Banks on import of gold by of ITC(HS). Tariff Rate Quota (TRQ) holders under the India UAE CEPA as notified by IFSCA. 'Qualified Suppliers' for supply of bullion on India International Bullion Exchange (v) RBI vide circular RBI/2023-24/120 DoR.AUT.REC.74/24.01.041/2023-24 dated February 9, (December 11, 2023) 2024, has permitted the following- Not changing any other provision of the IFSCA circular 415/IFSCA/Consolidated Operating a. Branch/subsidiary/joint venture of an Indian bank in GIFT IFSC to act as a Trading Guidelines/2021-22 dated August 18, 2022, the instant Circular renamed 'Limited Purpose Member (TM)/Trading and Clearing Member (TCM) of IIBX, and b. Indian banks authorized to import gold/silver to act as Special Category Client (SCC) of Trading Member(s)' or 'LPTM(s)' in the IFSCA Circular dated August 18, 2022, as 'Special IIBX Category' Client(s). 56 572023-24 registered vaults located in SEZs as per the guidelines prescribed by the IFSCA. Subsequently, Import of UAEGD Gold through IIBX by valid India-UAE TRQ holders (December 13, IFSCA issued a circular on December 13, 2023, to facilitate the participation of India-UAE CEPA 2023) TRQ Holders on the IIBX for import of UAE Good Delivery (UAEGD) TRQ Gold under the India-UAE Subsequent to the DGFT notification No.44/2023 dated November 20, 2023, permitting valid CEPA. India UAE TRQ Holders as notified by IFSCA to import gold through IIBX against the TRQ, this Further, RBI vide circular dated January 31, 2024, provided the guidelines on import of gold by Circular permitted the valid holders of India - UAE Tariff Rate Quota (TRQ) license / authorisation TRQ Holders under the India UAE CEPA as notified by IFSCA to all the Category-I Authorised Dealer as allotted by DGFT to be eligible to apply for being notified as 'India-UAE TRQ holders' by the Banks. During FY 2023-24, IFSCA notified 82 valid India UAE CEPA TRQ Holders. IFSCA. After being notified by the IFSCA, such valid India-UAE TRQ holders have been permitted to participate on IIBX, through Bullion Trading Members, for transacting in ('buying' only) UAEGD Major Developments/Operations gold for import under the India-UAE CEPA, subject to the quota, and other applicable terms and (i) The Office of Development Commissioner, GIFT SEZ (Ministry of Commerce and Industry), conditions. through public notice no. 01/2023-24 dated May 11, 2023, intimated about the launch of the Bullion Trading Members and Clearing Members in GIFT- IFSC (February 22, 2024) Indian Custom EDI System- ICES/ICEGATE for imports and exports at GIFT Multi Services SEZ, Gandhinagar, Gujarat. In continuation to the IFSCA circular dated August 07, 2023, this Circular extended the initial 6- month period (from the date of operationalization of Bullion Exchange) for maintaining the Net (ii) IIBX implemented every 30 minutes settlement of Bullion Depository Receipts (BDRs) for pre- Worth and Base Minimum Capital specified in the paragraph 3 and 4 of the IFSCA Circular F.No. funded T+0 contracts and direct pay-outs of BDRs to Clients/ SCCs for pre-funded T+0 329/IFSCA/Bullion MIIs/2021 dated September 17, 2021, by an additional period of 6 months i.e., contracts. till July 28, 2024. (iii) IIBX implemented Multiple Fund settlement cycles for T+0 contracts (3 cycles per day) for funds pay-out for the T+0 contracts traded on IIBX with effect from March 11, 2024. Notifications/Circular/Guidelines issued by other Circulars/ Guidelines issued by the Authority agencies relevant to the Bullion Ecosystem in IFSC Bullion Trading Members and Clearing Members in IFSC (August 07, 2023) (i) DGFT vide Notification No. 35/2023 dated October 11, 2023, amended the import policy condition for silver to permit import by QJs under ITC (HS) Codes 71069110 and 71069290. In continuation to the IFSCA circular dated January 27, 2023, this circular extended the initial 6- month period (from the date of operationalization of Bullion Exchange) for maintaining the Net (ii) RBI vide circular RBI/2023-2024/83 A.P. (DIR Series) Circular No. 07 dated November 10, Worth and Base Minimum Capital specified in the paragraph 3 and 4 of the IFSCA Circular F.No. 2023, provided guidelines to all the Category-I Authorised Dealer Banks on import of silver by 329/IFSCA/Bullion MIIs/2021 dated September 17, 2021, by an additional period of 6 months i.e., Qualified Jewellers as notified by IFSCA. till January 28, 2024. (iii) DGFT vide notification no. 44/2023 dated November 20, 2023, amended the import policy condition of gold under HS code 71081200 permitting the valid India-UAE TRQ holders as Import of gold and silver by Qualified Jewellers through India International Bullion notified by IFSCA to import gold through IIBX against the TRQ and taking physical delivery of Exchange (December 11, 2023) the same through IFSCA registered vaults located in SEZs as per the guidelines prescribed by A consolidated circular was issued for the purposes of import of gold and silver by eligible entities the IFSCA. as Qualified Jewellers, to transact on IIBX as clients of Bullion Trading Members or as 'Special (iv) RBI vide circular RBI/2023-24/118 A.P. (DIR Series) Circular No.14 dated January 31, 2024, Category' Clients (SCC) under ITC(HS) codes 7106, 7108, 7113, 7114 and 7118 under Chapter 71 provided the guidelines to all the Category-I Authorised Dealer Banks on import of gold by of ITC(HS). Tariff Rate Quota (TRQ) holders under the India UAE CEPA as notified by IFSCA. 'Qualified Suppliers' for supply of bullion on India International Bullion Exchange (v) RBI vide circular RBI/2023-24/120 DoR.AUT.REC.74/24.01.041/2023-24 dated February 9, (December 11, 2023) 2024, has permitted the following- Not changing any other provision of the IFSCA circular 415/IFSCA/Consolidated Operating a. Branch/subsidiary/joint venture of an Indian bank in GIFT IFSC to act as a Trading Guidelines/2021-22 dated August 18, 2022, the instant Circular renamed 'Limited Purpose Member (TM)/Trading and Clearing Member (TCM) of IIBX, and b. Indian banks authorized to import gold/silver to act as Special Category Client (SCC) of Trading Member(s)' or 'LPTM(s)' in the IFSCA Circular dated August 18, 2022, as 'Special IIBX Category' Client(s). 56 572023-24 Working Group/ Committee efforts will be made to create additional vaulting centres in locations such as Delhi and Kolkata. Policy framework for enabling gold savings accounts and gold accumulation plans IFSCA constituted Precious Metal Advisory Committee (PMAC), under chairmanship of Mr. by Banks and NBFCs Somasundaram PR, MD and Regional CEO, World Gold Council (India), as a major step towards stakeholder engagement on the strategic and operational aspects for the growth and development Gold Savings Account – A New Financial Product envisaged by NITI Ayog of precious metal ecosystem in GIFT IFSC and the country at large. The Committee would bring NITI Ayog report on Transforming India's Gold Market (February 2018) proposed a new financial expertise, objectivity and transparency and shall assist IFSCA in staying abreast of developments product for gold as Gold Savings Account. It was mentioned in the report that a GSA may be opened and identifying growth opportunities in the precious metals sector. The Committee would bridge by banks for their customers which will go beyond the scope of GMS deposit and allow investors the gap between the IFSCA and the industry, and work on a comprehensive roadmap with targets and individuals. It was also mentioned that the GSA shall offer the opportunity to build up an to achieve the broad regulatory objectives of the IFSCA. investment in gold over a period of time by virtually saving in gold terms. In essence, the GSA is similar to any other savings interest-bearing deposit account held at a bank or another financial Advocacy and Outreach institution that provides an interest rate except that the deposit will be translated in physical gold Various outreach programs were undertaken by IFSCA towards the growth and development of held by the bank or the financial institution. When a customer deposits cash in his or her account, Bullion ecosystem in IFSC. These include participation in global and national conferences such as- the bank will credit grams of gold. The price of gold will be based on the date on which the deposit is made. The GSA can be a linked to a demat account which would enable the linkage of digital gold (i) India Silver Conference, Jaipur, in April 2023 accounts across banks through the proposed Bullion exchange and its vaulting infrastructure. This (ii) Asia Pacific Precious Metals Conference, Singapore, in June 2023 is similar to the current linkage in stocks, where banks, demat accounts, stock exchanges and (iii) India Gold Conference, Kolkata, in August 2023 (iv) Global Precious Metals Conference, Barcelona, Spain in October 2023 depositaries are linked in a transparent manner. (v) Dubai Precious Metal Conference, Dubai, UAE, in November 2023 IFSCA aims to implement the proposal envisioned by NITI Aayog by establishing a policy (vi) IGPC-IIMA Annual Gold & Gold Markets Conference, New Delhi, in February 2024 framework that enables banks and finance companies in IFSC to link Gold Savings Accounts and Further, the Authority also interacted with the market participants of the Bullion ecosystem in Gold Accumulation Plans with the existing Bullion Depository Receipts framework. This GIFT IFSC to gather their feedback on various challenges faced by them while trading and framework is connected to the underlying gold stored in various IFSC vaulting locations that may importing through IIBX. be established across the country. The initiative targets Non-Resident Individuals, including High Net-Worth Individuals (HNIs), as well as institutions such as fund houses and Alternative Policies and programs for the Following Year Investment Funds (AIFs), etc. Review and revision of IFSCA (Bullion Exchange) Regulations, 2020 Policy Framework for enabling Digital Gold and tokenisation of BDRs Regulation 7 of the IFSCA (Procedure for making Regulations) Regulations, 2021, stipulates that As an extension of the Gold Savings Account, there is potential to allow Digital Gold FinTech firms the IFSCA shall review each Regulation, every three years. The IFSCA (Bullion Exchange) to establish operations in GIFT IFSC. These firms could link their software and mobile applications Regulations, 2020 which were notified on December 4, 2020, are due for review. IFSCA has already to serve as user interfaces for purchasing gold through the app. Additionally, tokenization of sought, and received, suggestions for review of IFSCA (Bullion Exchange) Regulations, 2020 for Bullion Depository Receipts (BDRs) could be considered, given that the underlying assets of BDRs public and regulated entities. are physical gold and silver. This initiative may encourage FinTech firms to explore opportunities in GIFT IFSC for the operationalization of digital gold and tokenization linked to BDRs. Operationalising the IFSC vaulting centres at other locations within Special Economic Zones or Free Trade Warehousing Zones across India Constitution of an Expert Committee on positioning GIFT IFSC as Global Commodity Trading Hub The IFSCA aims to establish vaulting facilities at locations outside GIFT IFSC, enabling market participants such as QJs, nominated banks, and TRQ holders to receive gold and silver deliveries at With a view to enable commodity trading in IFSC which will facilitate business integration of IFSC major bullion centres across India. This initiative will support their manufacturing activities and is financial ecosystem with global trade flows, capitalize on integration opportunities with major expected to boost trading volumes on the IIBX. commodity hubs and attract global investment flows into IFSC, thereby helping IFSC grow competitively, IFSCA shall be constituting an 'Expert Committee on positioning GIFT IFSC as Global In the near future, a vaulting centre may be established at Chennai by identifying a suitable special Commodity Trading Hub' under the chairmanship of Shri Rajeev Kher, former Commerce economic zone and vaulting infrastructure, which will greatly benefit the gems and jewellery Secretary. The Expert Committee is expected to submit its report by end-December 2024. sector in southern India. Following the successful establishment of an IFSC unit outside GIFT City, 58 592023-24 Working Group/ Committee efforts will be made to create additional vaulting centres in locations such as Delhi and Kolkata. Policy framework for enabling gold savings accounts and gold accumulation plans IFSCA constituted Precious Metal Advisory Committee (PMAC), under chairmanship of Mr. by Banks and NBFCs Somasundaram PR, MD and Regional CEO, World Gold Council (India), as a major step towards stakeholder engagement on the strategic and operational aspects for the growth and development Gold Savings Account – A New Financial Product envisaged by NITI Ayog of precious metal ecosystem in GIFT IFSC and the country at large. The Committee would bring NITI Ayog report on Transforming India's Gold Market (February 2018) proposed a new financial expertise, objectivity and transparency and shall assist IFSCA in staying abreast of developments product for gold as Gold Savings Account. It was mentioned in the report that a GSA may be opened and identifying growth opportunities in the precious metals sector. The Committee would bridge by banks for their customers which will go beyond the scope of GMS deposit and allow investors the gap between the IFSCA and the industry, and work on a comprehensive roadmap with targets and individuals. It was also mentioned that the GSA shall offer the opportunity to build up an to achieve the broad regulatory objectives of the IFSCA. investment in gold over a period of time by virtually saving in gold terms. In essence, the GSA is similar to any other savings interest-bearing deposit account held at a bank or another financial Advocacy and Outreach institution that provides an interest rate except that the deposit will be translated in physical gold Various outreach programs were undertaken by IFSCA towards the growth and development of held by the bank or the financial institution. When a customer deposits cash in his or her account, Bullion ecosystem in IFSC. These include participation in global and national conferences such as- the bank will credit grams of gold. The price of gold will be based on the date on which the deposit is made. The GSA can be a linked to a demat account which would enable the linkage of digital gold (i) India Silver Conference, Jaipur, in April 2023 accounts across banks through the proposed Bullion exchange and its vaulting infrastructure. This (ii) Asia Pacific Precious Metals Conference, Singapore, in June 2023 is similar to the current linkage in stocks, where banks, demat accounts, stock exchanges and (iii) India Gold Conference, Kolkata, in August 2023 (iv) Global Precious Metals Conference, Barcelona, Spain in October 2023 depositaries are linked in a transparent manner. (v) Dubai Precious Metal Conference, Dubai, UAE, in November 2023 IFSCA aims to implement the proposal envisioned by NITI Aayog by establishing a policy (vi) IGPC-IIMA Annual Gold & Gold Markets Conference, New Delhi, in February 2024 framework that enables banks and finance companies in IFSC to link Gold Savings Accounts and Further, the Authority also interacted with the market participants of the Bullion ecosystem in Gold Accumulation Plans with the existing Bullion Depository Receipts framework. This GIFT IFSC to gather their feedback on various challenges faced by them while trading and framework is connected to the underlying gold stored in various IFSC vaulting locations that may importing through IIBX. be established across the country. The initiative targets Non-Resident Individuals, including High Net-Worth Individuals (HNIs), as well as institutions such as fund houses and Alternative Policies and programs for the Following Year Investment Funds (AIFs), etc. Review and revision of IFSCA (Bullion Exchange) Regulations, 2020 Policy Framework for enabling Digital Gold and tokenisation of BDRs Regulation 7 of the IFSCA (Procedure for making Regulations) Regulations, 2021, stipulates that As an extension of the Gold Savings Account, there is potential to allow Digital Gold FinTech firms the IFSCA shall review each Regulation, every three years. The IFSCA (Bullion Exchange) to establish operations in GIFT IFSC. These firms could link their software and mobile applications Regulations, 2020 which were notified on December 4, 2020, are due for review. IFSCA has already to serve as user interfaces for purchasing gold through the app. Additionally, tokenization of sought, and received, suggestions for review of IFSCA (Bullion Exchange) Regulations, 2020 for Bullion Depository Receipts (BDRs) could be considered, given that the underlying assets of BDRs public and regulated entities. are physical gold and silver. This initiative may encourage FinTech firms to explore opportunities in GIFT IFSC for the operationalization of digital gold and tokenization linked to BDRs. Operationalising the IFSC vaulting centres at other locations within Special Economic Zones or Free Trade Warehousing Zones across India Constitution of an Expert Committee on positioning GIFT IFSC as Global Commodity Trading Hub The IFSCA aims to establish vaulting facilities at locations outside GIFT IFSC, enabling market participants such as QJs, nominated banks, and TRQ holders to receive gold and silver deliveries at With a view to enable commodity trading in IFSC which will facilitate business integration of IFSC major bullion centres across India. This initiative will support their manufacturing activities and is financial ecosystem with global trade flows, capitalize on integration opportunities with major expected to boost trading volumes on the IIBX. commodity hubs and attract global investment flows into IFSC, thereby helping IFSC grow competitively, IFSCA shall be constituting an 'Expert Committee on positioning GIFT IFSC as Global In the near future, a vaulting centre may be established at Chennai by identifying a suitable special Commodity Trading Hub' under the chairmanship of Shri Rajeev Kher, former Commerce economic zone and vaulting infrastructure, which will greatly benefit the gems and jewellery Secretary. The Expert Committee is expected to submit its report by end-December 2024. sector in southern India. Following the successful establishment of an IFSC unit outside GIFT City, 58 592023-24 FINTECH Policy/ Regulatory Developments Framework for FinTech Entity in the IFSCs In the last few years, India has shown its mettle in the FinTech space, the bright young Indian IFSCA issued a circular providing for a unique Framework for FinTech Entity in the IFSCs (“FE talent with expertise in IT and Finance have created cutting edge innovations in the field of Framework”) for FinTechs and TechFins on April 27, 2022. Financial Technology and positioned India as a global front runner in the FinTech ecosystem. The FE Framework provides for IFSCA FinTech Regulatory Sandbox and IFSCA FinTech Innovation GIFT IFSC is strategically positioned to propel the Indian FinTech ecosystem onto the global Sandbox to test/develop FinTech Products/ solutions and empowers IFSCA to grant Limited Use FinTech stage. To support the Indian FinTech firms & Start-ups to go global and develop IFSC as Authorization (LUA) to eligible financial technology entity in GIFT IFSC. Further, it also enables a global laboratory for developing next generation FinTech solutions, the Hon’ble Finance some class/categories of technology companies having a deployable advanced/innovative Minister in Union Budget 2021-22 announced “The Government would support the technology solution which aids and assists activities in relation to financial products, financial development of a world class Fin-Tech hub at the GIFT IFSC”. services, financial institutions and, credible track record including financial performance, to obtain Direct Entry (Authorization by IFSCA). Towards this goal, IFSCA has released globally benchmarked “Framework for FinTech Entity in the IFSCs”, which covers both FinTech and TechFin. Additionally, IFSCA launched FinTech The FE Framework also incorporates two additional mechanisms to support the FinTech Entities Incentive Scheme, 2022, to encourage young FinTech innovators, the Scheme would support as detailed below: domestic FinTech firms wanting to go global, foreign FinTech firms who want to come to GIFT Inter Operable Regulatory Sandbox (IoRS): IoRS is a proposed mechanism to facilitate IFSC and domestic FinTech firms aiming to grow its Indian business or wanting to work on testing of innovative hybrid financial products / services falling within the regulatory ambit of regulatory sandbox, Proof of Concept (PoC) etc. in IFSCs by providing various types of grants. more than one financial sector regulators. IFSCA will facilitate Indian FinTech's seeking access to As of March 31, 2024, 20 entities have received Limited Use Authorization to be part of foreign markets and foreign FinTech's seeking entry into India. Innovation Sandbox, 16 entities in Regulatory Sandbox and 8 entities as Accelerators. Further, Regulatory Referral Mechanism/FinTech Bridges: It shall be governed as per the 8 entities have received Authorization to undertake business operations as TechFin till date. 11 provisions of the Memorandum of Understanding (MoU) or collaboration or special arrangement Hackathons have been completed and IFSCA has received 131 applications from 14 between IFSCA and corresponding overseas Regulator(s). Currently IFSCA has FinTech Bridge jurisdictions under the FinTech Entity framework. with Monetary Authority of Singapore which was executed by the way of MoU between the two regulators. IFSCA FinTech Incentive Scheme, 2022 Hon'ble Prime Minister of India, while inaugurating the InFinity Forum 2.0 articulated the vision to establish GIFT City as the preeminent Global Nerve Centre for New Age Financial and The IFSCA, with an overall objective to promote the establishment of a world-class FinTech Hub, at Technology Services. Highlighting the accomplishments of IFSCA, including the release of a GIFT IFSC in India, launched the IFSCA (FinTech Incentive) Scheme for providing financial support Progressive Regulatory Framework for FinTech in 2022 and the implementation of the FinTech to FinTech activities in the form of specific grant(s)The guidelines for implementation of the Incentive Scheme, which supports both Indian and foreign FinTech ventures to foster innovation Scheme were issued on September 12, 2022. and entrepreneurship. He emphasized GIFT City's role as a Global FinTech hub and a pioneering Twelve applications have been recommended for Grants amounting to a total of ₹2.65 Crores by FinTech Laboratory on the international stage. the Evaluation Committee (EC) under the Scheme in FY 2023-24. Transaction/ Processes/ Operations/ Trends IFSCA has received a total of 131 applications under the FinTech Entity Framework from 14 jurisdiction since its inception. The Authority received 65 applications in the FY 2023-24 from across 8 jurisdictions (India, USA, Mauritius, Singapore, Australia, UK, Hong Kong and UAE) under the FE Framework. A pictorial representation of the number of applications received under different categories is given below: 60 612023-24 FINTECH Policy/ Regulatory Developments Framework for FinTech Entity in the IFSCs In the last few years, India has shown its mettle in the FinTech space, the bright young Indian IFSCA issued a circular providing for a unique Framework for FinTech Entity in the IFSCs (“FE talent with expertise in IT and Finance have created cutting edge innovations in the field of Framework”) for FinTechs and TechFins on April 27, 2022. Financial Technology and positioned India as a global front runner in the FinTech ecosystem. The FE Framework provides for IFSCA FinTech Regulatory Sandbox and IFSCA FinTech Innovation GIFT IFSC is strategically positioned to propel the Indian FinTech ecosystem onto the global Sandbox to test/develop FinTech Products/ solutions and empowers IFSCA to grant Limited Use FinTech stage. To support the Indian FinTech firms & Start-ups to go global and develop IFSC as Authorization (LUA) to eligible financial technology entity in GIFT IFSC. Further, it also enables a global laboratory for developing next generation FinTech solutions, the Hon’ble Finance some class/categories of technology companies having a deployable advanced/innovative Minister in Union Budget 2021-22 announced “The Government would support the technology solution which aids and assists activities in relation to financial products, financial development of a world class Fin-Tech hub at the GIFT IFSC”. services, financial institutions and, credible track record including financial performance, to obtain Direct Entry (Authorization by IFSCA). Towards this goal, IFSCA has released globally benchmarked “Framework for FinTech Entity in the IFSCs”, which covers both FinTech and TechFin. Additionally, IFSCA launched FinTech The FE Framework also incorporates two additional mechanisms to support the FinTech Entities Incentive Scheme, 2022, to encourage young FinTech innovators, the Scheme would support as detailed below: domestic FinTech firms wanting to go global, foreign FinTech firms who want to come to GIFT Inter Operable Regulatory Sandbox (IoRS): IoRS is a proposed mechanism to facilitate IFSC and domestic FinTech firms aiming to grow its Indian business or wanting to work on testing of innovative hybrid financial products / services falling within the regulatory ambit of regulatory sandbox, Proof of Concept (PoC) etc. in IFSCs by providing various types of grants. more than one financial sector regulators. IFSCA will facilitate Indian FinTech's seeking access to As of March 31, 2024, 20 entities have received Limited Use Authorization to be part of foreign markets and foreign FinTech's seeking entry into India. Innovation Sandbox, 16 entities in Regulatory Sandbox and 8 entities as Accelerators. Further, Regulatory Referral Mechanism/FinTech Bridges: It shall be governed as per the 8 entities have received Authorization to undertake business operations as TechFin till date. 11 provisions of the Memorandum of Understanding (MoU) or collaboration or special arrangement Hackathons have been completed and IFSCA has received 131 applications from 14 between IFSCA and corresponding overseas Regulator(s). Currently IFSCA has FinTech Bridge jurisdictions under the FinTech Entity framework. with Monetary Authority of Singapore which was executed by the way of MoU between the two regulators. IFSCA FinTech Incentive Scheme, 2022 Hon'ble Prime Minister of India, while inaugurating the InFinity Forum 2.0 articulated the vision to establish GIFT City as the preeminent Global Nerve Centre for New Age Financial and The IFSCA, with an overall objective to promote the establishment of a world-class FinTech Hub, at Technology Services. Highlighting the accomplishments of IFSCA, including the release of a GIFT IFSC in India, launched the IFSCA (FinTech Incentive) Scheme for providing financial support Progressive Regulatory Framework for FinTech in 2022 and the implementation of the FinTech to FinTech activities in the form of specific grant(s)The guidelines for implementation of the Incentive Scheme, which supports both Indian and foreign FinTech ventures to foster innovation Scheme were issued on September 12, 2022. and entrepreneurship. He emphasized GIFT City's role as a Global FinTech hub and a pioneering Twelve applications have been recommended for Grants amounting to a total of ₹2.65 Crores by FinTech Laboratory on the international stage. the Evaluation Committee (EC) under the Scheme in FY 2023-24. Transaction/ Processes/ Operations/ Trends IFSCA has received a total of 131 applications under the FinTech Entity Framework from 14 jurisdiction since its inception. The Authority received 65 applications in the FY 2023-24 from across 8 jurisdictions (India, USA, Mauritius, Singapore, Australia, UK, Hong Kong and UAE) under the FE Framework. A pictorial representation of the number of applications received under different categories is given below: 60 61Figure 9 : Comparative Analysis of Applications in permissible areas under FE Framework for FY 2022-23 and FY 2023-24 0% 4% FY 2023-24 17% 20% 0 63% 32% FY 2022-23 9% 9% 6% 76% 64% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Banking Capital Market Insurance Techfin IFSCA FinTech Regulatory Sandbox IFSCA FinTech Innovation Sandbox Figure 10 : Five Major emerging areas of Application in the TechFin category in FY 2023-24 Inter Operable Regulatory Sandbox Accelerators 38% 40% 21% 17% 12% 12% 30% 20% 10% 0% FY 2023-24 fo egatnec reP snoitacilppA 2023-24 Figure 11 : FinTech Entities granted Limited Use Authorization under FE Framework for FY 2023-24 Advocacy and Outreach Global Financial Innovation Network (GFIN) IFSCA was elected as a member in the Coordination Group of GFIN in Annual General Meeting of GFIN held in Washington D.C from November 07-09, 2023. This may enable IFSCA to set the overall direction, strategy and annual work programme of the GFIN aligning with its objectives and contribute to the secretariat functions of GFIN. IFSCA – IAIS Engagements Solutions/services for BFSI domain leveraging : AI, DLT, Big Data etc Reg Tech IFSCA joined the FinTech Forum of International Association of Insurance Supervisors (IAIS). The Technology solution supporting Digital banking IAIS FinTech Forum is a virtual forum of technical experts from the IAIS' diverse membership that Technology Solution supporting Trade Finance serves as a platform to share practical insights and experiences on FinTech-related developments Other Areas in TechFin influencing the insurance sector and global insurance supervisors. IFSCA has granted 26 regulatory approvals in the financial year 2023-24 including 4 MoUs with FinTech Hubs and Educational Institutions during the year Authorizations and 22 LUAs. Further IFSCA has also referred an application to Monetary Authority MoUs were signed with the following Domestic FinTech hubs, educational institutions and bodies of Singapore under Overseas Regulatory Referral Mechanism of the FE Framework. The Detailed to augment the FinTech ecosystem at GIFT IFSC: breakup of the FinTech Entities who are granted LUAs is graphically represented below: 62 63Figure 9 : Comparative Analysis of Applications in permissible areas under FE Framework for FY 2022-23 and FY 2023-24 0% 4% FY 2023-24 17% 20% 0 63% 32% FY 2022-23 9% 9% 6% 76% 64% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Banking Capital Market Insurance Techfin IFSCA FinTech Regulatory Sandbox IFSCA FinTech Innovation Sandbox Figure 10 : Five Major emerging areas of Application in the TechFin category in FY 2023-24 Inter Operable Regulatory Sandbox Accelerators 38% 40% 21% 17% 12% 12% 30% 20% 10% 0% FY 2023-24 fo egatnec reP snoitacilppA 2023-24 Figure 11 : FinTech Entities granted Limited Use Authorization under FE Framework for FY 2023-24 Advocacy and Outreach Global Financial Innovation Network (GFIN) IFSCA was elected as a member in the Coordination Group of GFIN in Annual General Meeting of GFIN held in Washington D.C from November 07-09, 2023. This may enable IFSCA to set the overall direction, strategy and annual work programme of the GFIN aligning with its objectives and contribute to the secretariat functions of GFIN. IFSCA – IAIS Engagements Solutions/services for BFSI domain leveraging : AI, DLT, Big Data etc Reg Tech IFSCA joined the FinTech Forum of International Association of Insurance Supervisors (IAIS). The Technology solution supporting Digital banking IAIS FinTech Forum is a virtual forum of technical experts from the IAIS' diverse membership that Technology Solution supporting Trade Finance serves as a platform to share practical insights and experiences on FinTech-related developments Other Areas in TechFin influencing the insurance sector and global insurance supervisors. IFSCA has granted 26 regulatory approvals in the financial year 2023-24 including 4 MoUs with FinTech Hubs and Educational Institutions during the year Authorizations and 22 LUAs. Further IFSCA has also referred an application to Monetary Authority MoUs were signed with the following Domestic FinTech hubs, educational institutions and bodies of Singapore under Overseas Regulatory Referral Mechanism of the FE Framework. The Detailed to augment the FinTech ecosystem at GIFT IFSC: breakup of the FinTech Entities who are granted LUAs is graphically represented below: 62 632023-24 Table 23 : MoUs with FinTech Hubs and Educational Institutions during FY 2023-24 InFinity Forum (IF) 2.0 Sr. No. MoU signed with Date InFinity Forum is the IFSCA's flagship financial technology event, uniting the world's leading minds in policy, business, and technology to explore and advance the biggest ideas in Finance & 1 International Institute of Information Technology and IHub Data April 28, 2023 Technology, and to develop those ideas into global solutions and opportunities. 2 Enterprise Incubation Centre, Indian Institute of July 11, 2023 Management Lucknow (IIML) 3 Pilani Innovation and Entrepreneurship Development Society July 13, 2023 (PIEDS), BITS PILANI 4 Kerala Start-Up Mission (KSUM) July 21, 2023 5 Foundation for Innovation & Research in Science &Technology August 9, 2023 (FIRST), Indian Institute of Technology (IIT) Kanpur 6 Software Technology Parks of India (STPI) December 08, 2023 7 Ahmedabad University (AU) December 08, 2023 Image 12 : Hon’ble Prime Minister of India inaugurating the InFinity Forum 2.0 The Second edition of InFinity Forum 2.0 themed “GIFT IFSC - Nerve Centre for New Age Global Financial Services” was held on December 9, 2023. The event was inaugurated virtually by Hon'ble Prime Minister, Shri Narendra Modi through Video Conference. IF 2.0 had the distinct honour of hosting several influential leaders like Shri Bhupendra Patel, Hon'ble Chief Minister of Gujarat, Shri Piyush Goyal, Hon'ble Union Minister of Commerce and Industry, Consumer Affairs, Food & Public Distribution and Textiles, and Shri Ashwini Vaishnaw, Hon'ble Minister for Railways, Communications, Electronics and Information Technology and other industry leaders each contributing their unique perspectives to the discourse on future of international financial services. Primarily focused on three tracks - Plenary, Green and Silver, the InFinity Forum 2.0 catalysed pivotal discussions, facilitated a captivating exchange of ideas and discussions by luminaries from Image 11 : (Clockwise from top left) IFSCA signing MoU with Ahmedabad University, KSUM, STPI, PIEDS, the global financial sector, fostering thought provoking conversations and paving the way for FIRST, Enterprise Incubation Centre innovative solutions and opportunities. 64 652023-24 Table 23 : MoUs with FinTech Hubs and Educational Institutions during FY 2023-24 InFinity Forum (IF) 2.0 Sr. No. MoU signed with Date InFinity Forum is the IFSCA's flagship financial technology event, uniting the world's leading minds in policy, business, and technology to explore and advance the biggest ideas in Finance & 1 International Institute of Information Technology and IHub Data April 28, 2023 Technology, and to develop those ideas into global solutions and opportunities. 2 Enterprise Incubation Centre, Indian Institute of July 11, 2023 Management Lucknow (IIML) 3 Pilani Innovation and Entrepreneurship Development Society July 13, 2023 (PIEDS), BITS PILANI 4 Kerala Start-Up Mission (KSUM) July 21, 2023 5 Foundation for Innovation & Research in Science &Technology August 9, 2023 (FIRST), Indian Institute of Technology (IIT) Kanpur 6 Software Technology Parks of India (STPI) December 08, 2023 7 Ahmedabad University (AU) December 08, 2023 Image 12 : Hon’ble Prime Minister of India inaugurating the InFinity Forum 2.0 The Second edition of InFinity Forum 2.0 themed “GIFT IFSC - Nerve Centre for New Age Global Financial Services” was held on December 9, 2023. The event was inaugurated virtually by Hon'ble Prime Minister, Shri Narendra Modi through Video Conference. IF 2.0 had the distinct honour of hosting several influential leaders like Shri Bhupendra Patel, Hon'ble Chief Minister of Gujarat, Shri Piyush Goyal, Hon'ble Union Minister of Commerce and Industry, Consumer Affairs, Food & Public Distribution and Textiles, and Shri Ashwini Vaishnaw, Hon'ble Minister for Railways, Communications, Electronics and Information Technology and other industry leaders each contributing their unique perspectives to the discourse on future of international financial services. Primarily focused on three tracks - Plenary, Green and Silver, the InFinity Forum 2.0 catalysed pivotal discussions, facilitated a captivating exchange of ideas and discussions by luminaries from Image 11 : (Clockwise from top left) IFSCA signing MoU with Ahmedabad University, KSUM, STPI, PIEDS, the global financial sector, fostering thought provoking conversations and paving the way for FIRST, Enterprise Incubation Centre innovative solutions and opportunities. 64 652023-24 FinTech Investors Meet 2023 (ii) Closed door session “Meet the Regulator” with recognised domestic and international FinTech firms. IFSCA organised an Investors Meet on December 8, 2023, as a prelude to the InFinity Forum 2.0. The main objective of the Investors Meet was to connect selected FinTech entities and chosen (iii) Panel discussion by 4 Authorised FinTech Entities and 1 IBU on the topic “My GIFT Journey” to investors, paving way for symbiotic collaborations and investment opportunities. share their experiences in GIFT IFSC. (iv) IFSCA set up a booth in GFF 2023 as part of the outreach activities Image 13 : Investors Meet 2023 in GIFT City The event commenced with pitches delivered by curated FinTech entities, succeeded by one-on- one discussions between the shortlisted entities and investors. Subsequently, a panel discussion featuring investors was held, followed by an interactive session involving FinTech entities, Image 14 : Global FinTech Festival 2023 in Mumbai investors, IFSCA, and GIFT City representatives. The event saw participation from prominent investment firms like Beam FinTech Fund, Peak XV, Matrix Partners India, EPIC Investment, Elevation Capital, GVFL, Venture Catalyst, 3one4 capital, White Ventures, TVS capital. I-Sprint'23 In continuation to I-Sprint' 22, Global Hackathons (named I-Sprints'23) were conducted in partnership with various organizations to promote innovation. A total of six Sprints (Sprint 8, 9, 10,11,12,13) were held in which 600+ applications were received as of March 2024. Participation in Global FinTech Fest (GFF) 2023 The GFF 2023 was held at Jio World Centre, Mumbai was organised by FinTech Convergence Council, Payment Council of India (PCI) and National Payments Corporation of India (NPCI) on September 05-07, 2023. IFSCA participated in the GFF 2023 in the following ways: (i) Chairperson, IFSCA delivered a keynote address on “Transforming International FinTech Image 15 : IFSCA Booth in Global FinTech Festival 2023 Landscape through Innovation and Responsible Global Collaboration”. 66 672023-24 FinTech Investors Meet 2023 (ii) Closed door session “Meet the Regulator” with recognised domestic and international FinTech firms. IFSCA organised an Investors Meet on December 8, 2023, as a prelude to the InFinity Forum 2.0. The main objective of the Investors Meet was to connect selected FinTech entities and chosen (iii) Panel discussion by 4 Authorised FinTech Entities and 1 IBU on the topic “My GIFT Journey” to investors, paving way for symbiotic collaborations and investment opportunities. share their experiences in GIFT IFSC. (iv) IFSCA set up a booth in GFF 2023 as part of the outreach activities Image 13 : Investors Meet 2023 in GIFT City The event commenced with pitches delivered by curated FinTech entities, succeeded by one-on- one discussions between the shortlisted entities and investors. Subsequently, a panel discussion featuring investors was held, followed by an interactive session involving FinTech entities, Image 14 : Global FinTech Festival 2023 in Mumbai investors, IFSCA, and GIFT City representatives. The event saw participation from prominent investment firms like Beam FinTech Fund, Peak XV, Matrix Partners India, EPIC Investment, Elevation Capital, GVFL, Venture Catalyst, 3one4 capital, White Ventures, TVS capital. I-Sprint'23 In continuation to I-Sprint' 22, Global Hackathons (named I-Sprints'23) were conducted in partnership with various organizations to promote innovation. A total of six Sprints (Sprint 8, 9, 10,11,12,13) were held in which 600+ applications were received as of March 2024. Participation in Global FinTech Fest (GFF) 2023 The GFF 2023 was held at Jio World Centre, Mumbai was organised by FinTech Convergence Council, Payment Council of India (PCI) and National Payments Corporation of India (NPCI) on September 05-07, 2023. IFSCA participated in the GFF 2023 in the following ways: (i) Chairperson, IFSCA delivered a keynote address on “Transforming International FinTech Image 15 : IFSCA Booth in Global FinTech Festival 2023 Landscape through Innovation and Responsible Global Collaboration”. 66 672023-24 FinTech Founders Meet IFSCA organised a master class on the theme “GIFT IFSC – Landing pad for foreign FinTechs, TechFins and Accelerators to the India market” during IFF 2023. IFSCA organised a FinTech Founders Meet in association with Internet and Mobile Association of India (IAMAI) in Bengaluru on February 03, 2024. Chairperson, IFSCA interacted with FinTech Roundtable Interaction with FinTech Associations/ Firms in Australia Founders at Bengaluru on February 03, 2024, and encouraged them to explore the various IFSCA convened a roundtable dialogue with FinTech firms and associations from Australia in possibilities and opportunities at GIFT IFSC. Sydney, Australia, on August 28, 2023. The objective of this engagement was to facilitate the exchange of information regarding the diverse initiatives undertaken by IFSCA within the FinTech domain, thereby promoting collaborations and partnerships between IFSCA and stakeholders in Australian FinTech ecosystem. IFSCA participated in the panel discussion themed “Opportunities and Challenges in Emerging FinTech Markets” in Intersekt' 23, FinTech Conference organised by FinTech Australia, followed by an interaction with FinTechs. Image 16: IFSCA with participants of FinTech Founders Meet in Bangalore Virtual RoundTable on Data Centre IFSCA in association with Associated Chambers of Commerce & Industry of India (ASSOCHAM) and National Association of Software and Service Companies (NASSCOM) organised a virtual roundtable on data centre on February 22, 2024, envisioning to deliberate on the scope of Data Centre related activities in GIFT IFSC. The discussion largely focussed on the experiences and feedback from the industry participants for making GIFT IFSC more attractive location for Data Centres. Image 17: IFSCA participating in the panel discussion in Intersekt’ 23 Participation in FinTech Festival India 2024 The FinTech Festival of India 2024 was held in Yashobhoomi, Dwaraka, New Delhi from 06-08 Singapore FinTech Festival (SFF) 2023 March 2024. IFSCA participated in the FinTech Festival India 2024 and interacted with the The 8 edition of the SFF was held in Singapore from November 15 to November 17, 2023. relevant FinTech Entities. An IFSCA booth was set up to promote the visibility of its pioneering FinTech initiatives like Other International Engagements FinTech Entity Framework, FinTech Incentive Scheme, FinTech Bridges, etc. Chairperson, IFSCA participated in the panel discussion as distinguished on “Creating Inclusive Inclusive FinTech Forum (IFF) 2023 Policy Frameworks” and emphasized on the need for the calibration of the mindset of the The First edition of Inclusive FinTech Forum (2023), organised by Kigali international Financial regulators to maximize the gain emerging out of adoption of the technology. Centre and Elevandi, was held in Kigali, Rwanda from June 20 to 23, 2023. IFSCA participated in the Roundtable organised in SFF 2023 themed “Bridging the Gap: AI IFSCA participated in the Roundtable at IFF 2023 on the invitation from Monetary Authority of Governance in Banking – From Principles to Practice” Singapore (MAS) and Elevandi on the theme “Bridging the Gap: AI Governance in Banking – From Further, IFSCA organised a regulatory master class in SFF 2023 to disseminate information about Principles to Practice”. the GIFT IFSC. 68 692023-24 FinTech Founders Meet IFSCA organised a master class on the theme “GIFT IFSC – Landing pad for foreign FinTechs, TechFins and Accelerators to the India market” during IFF 2023. IFSCA organised a FinTech Founders Meet in association with Internet and Mobile Association of India (IAMAI) in Bengaluru on February 03, 2024. Chairperson, IFSCA interacted with FinTech Roundtable Interaction with FinTech Associations/ Firms in Australia Founders at Bengaluru on February 03, 2024, and encouraged them to explore the various IFSCA convened a roundtable dialogue with FinTech firms and associations from Australia in possibilities and opportunities at GIFT IFSC. Sydney, Australia, on August 28, 2023. The objective of this engagement was to facilitate the exchange of information regarding the diverse initiatives undertaken by IFSCA within the FinTech domain, thereby promoting collaborations and partnerships between IFSCA and stakeholders in Australian FinTech ecosystem. IFSCA participated in the panel discussion themed “Opportunities and Challenges in Emerging FinTech Markets” in Intersekt' 23, FinTech Conference organised by FinTech Australia, followed by an interaction with FinTechs. Image 16: IFSCA with participants of FinTech Founders Meet in Bangalore Virtual RoundTable on Data Centre IFSCA in association with Associated Chambers of Commerce & Industry of India (ASSOCHAM) and National Association of Software and Service Companies (NASSCOM) organised a virtual roundtable on data centre on February 22, 2024, envisioning to deliberate on the scope of Data Centre related activities in GIFT IFSC. The discussion largely focussed on the experiences and feedback from the industry participants for making GIFT IFSC more attractive location for Data Centres. Image 17: IFSCA participating in the panel discussion in Intersekt’ 23 Participation in FinTech Festival India 2024 The FinTech Festival of India 2024 was held in Yashobhoomi, Dwaraka, New Delhi from 06-08 Singapore FinTech Festival (SFF) 2023 March 2024. IFSCA participated in the FinTech Festival India 2024 and interacted with the The 8 edition of the SFF was held in Singapore from November 15 to November 17, 2023. relevant FinTech Entities. An IFSCA booth was set up to promote the visibility of its pioneering FinTech initiatives like Other International Engagements FinTech Entity Framework, FinTech Incentive Scheme, FinTech Bridges, etc. Chairperson, IFSCA participated in the panel discussion as distinguished on “Creating Inclusive Inclusive FinTech Forum (IFF) 2023 Policy Frameworks” and emphasized on the need for the calibration of the mindset of the The First edition of Inclusive FinTech Forum (2023), organised by Kigali international Financial regulators to maximize the gain emerging out of adoption of the technology. Centre and Elevandi, was held in Kigali, Rwanda from June 20 to 23, 2023. IFSCA participated in the Roundtable organised in SFF 2023 themed “Bridging the Gap: AI IFSCA participated in the Roundtable at IFF 2023 on the invitation from Monetary Authority of Governance in Banking – From Principles to Practice” Singapore (MAS) and Elevandi on the theme “Bridging the Gap: AI Governance in Banking – From Further, IFSCA organised a regulatory master class in SFF 2023 to disseminate information about Principles to Practice”. the GIFT IFSC. 68 692023-24 Image 18 : Chairperson, IFSCA at Singapore FinTech Festival 2023 IFSCA – Japan Engagements IFSCA virtually addressed the FinTech event “India - Japan: Powering the FinTech Story", organised by the Embassy of India, Tokyo on January 16, 2024. Shri K. Rajaraman, Chairperson, IFSCA, during his address in the event, highlighted on India being a bright spot in the volatile global economy, unique features of GIFT IFSC and how it is driving the vision of Hon'ble PM for Viksit Bharat in 2047. Further, a presentation was delivered to the participants outlining the facilities available for FinTech Entities in GIFT IFSC. The event witnessed speakers from Department of Economic Affairs (Ministry of Finance, Government of India), Japan Financial Services Agency, Fincity Tokyo, MUFG Bank and was also attended by Japanese FinTechs and BFSI entities. 702023-24 Image 18 : Chairperson, IFSCA at Singapore FinTech Festival 2023 IFSCA – Japan Engagements IFSCA virtually addressed the FinTech event “India - Japan: Powering the FinTech Story", organised by the Embassy of India, Tokyo on January 16, 2024. Shri K. Rajaraman, Chairperson, IFSCA, during his address in the event, highlighted on India being a bright spot in the volatile global economy, unique features of GIFT IFSC and how it is driving the vision of Hon'ble PM for Viksit Bharat in 2047. Further, a presentation was delivered to the participants outlining the facilities available for FinTech Entities in GIFT IFSC. The event witnessed speakers from Department of Economic Affairs (Ministry of Finance, Government of India), Japan Financial Services Agency, Fincity Tokyo, MUFG Bank and was also attended by Japanese FinTechs and BFSI entities. 702023-24 INSURANCE IFSCA (Assets, Liabilities, Solvency Margin and Abstract of Actuarial Report for Life Insurance Business) Regulations, 2023 The regulations aim to specify the requirements related to capital, solvency, and submission of Insurance business is one of the most important segments of IFSC for developing the essential abstract of actuarial report by an IIO, who are permitted to transact Life Insurance Business. ecosystem of a financial market and providing insurance solutions to a global clientele. IFSCA (Assets, Liabilities, and Solvency Margin of General, Health and Re-insurance IFSCA has enacted a world class and comprehensive regulatory framework for the insurers, business) Regulations, 2023 reinsurers, and insurance intermediaries in IFSC focusing on ease of doing business. These The regulations aim to specify the requirements related to capital, solvency, and submission of regulations cover the aspects relating to registration of insurance business, manner of receipt abstract of actuarial report by an IIO, who are permitted to transact General, Health and Re- of premium, designing of insurance products, investment of assets, preparation and insurance business. presentation of financial statements, appointment and duties of appointed actuary, maintenance of information and records for inspection and investigation, inward and IFSCA (Management Control, Administrative Control and Market Conduct of outward reinsurance operations, solvency margin etc. insurance business) Regulations, 2023 While the growth in the domestic insurance market will enhance insurance inclusion and The regulations aim to put in place the regulatory framework related to Management Control, enable building large pools for Indian insurers, it also necessitates developing reinsurance Administrative Control and Market Conduct of insurance business carried out by an IIO or IIIO. capacities. GIFT IFSC, with its incentives and regulatory support, is well-positioned to develop Amendment to IFSCA (Investment by IIO) Regulations, 2022 these capacities for both Indian and global markets. Additionally, the global Indian diaspora offers significant opportunities for insurance entities to provide tailored health, life, and Considering the significance of investment income for insurers and re-insurers, IFSCA in travel insurance products by establishing operations in GIFT IFSC. accordance with Section 27 of the Insurance Act, 1938, had notified IFSCA (Investments by IIO) Regulations, 2022 on January 12, 2023. Subsequently, IRDAI on August 22, 2023, had notified Currently, the insurance ecosystem in IFSC comprises of 35 entities, including 12 IIOs (IFSC amendment to its Re-insurance Regulations, 2018. These regulations place IIO at par with Foreign Insurance Offices) and 23 IIIOs (IFSC Insurance Intermediary Offices). The total (Re)insurance Reinsurer Branch in Category 2 of Order of Preference subject to certain conditions on premium booked by IIOs is USD 360 Mn and the total (Re)insurance premium transacted by investments to be made in Domestic Tariff Area (DTA) in India. IIIOs is USD 918 Mn, up to March 2024. Based on the above amendment by the IRDAI, IFSCA had carried out suitable modifications to IFSCA (Investment by IIO) Regulations, 2022 and a consolidated version of the updated amended regulations has been made available on the website of the Authority. Policy/ Regulatory Developments Public consultation on various operational guidelines for IIOs To enable the rapid growth of insurance and re-insurance sector in GIFT IFSC, IFSCA has created a In December 2023, IFSCA placed following consultation papers for public consultation on its favourable regulatory environment. With thirteen regulations already in place canvassing most of website: the regulatory space, IFSCA has adopted a principles-based approach, in line with global best (i) Consultation paper on proposed Guidelines on IFSCA (Assets, Liabilities, and Solvency Margin practices. In the FY 2023-24, the following regulations were notified: of General, Health and Re-insurance business) Regulations, 2023 IFSCA (Re-insurance) Regulations, 2023 (ii) Consultation paper on proposed Guidelines on IFSCA (Assets, Liabilities, and Solvency Margin The regulations provide framework on oversight and control of inward and outward arrangement of Life insurance business) Regulations, 2023 of re-insurance business by the IIOs. The regulations require Board approved policy on Re- These guidelines provide reporting formats pertaining to requirements towards maintenance of insurance Strategy and Re-insurance Program (RSRP). capital and solvency margins for transacting insurance business by IIOs. As per IRDAI's framework, released in August 2023, IIOs at GIFT IFSC are placed in Category-2, i.e. at par with Foreign Re-insurance Branches (FRBs) in the Order of Preference, subject to certain Working Group/ Committee investment conditions. This marks a significant milestone since it would further enhance the prospects of GIFT IFSC to become a Global Reinsurance Hub. The extant IFSCA regulatory framework recognizes alternate risk transfer (ART) arrangements in the Re-insurance contract, subject to adherence with risk transfer requirements in such ART and accounting treatments for such transactions. 72 732023-24 INSURANCE IFSCA (Assets, Liabilities, Solvency Margin and Abstract of Actuarial Report for Life Insurance Business) Regulations, 2023 The regulations aim to specify the requirements related to capital, solvency, and submission of Insurance business is one of the most important segments of IFSC for developing the essential abstract of actuarial report by an IIO, who are permitted to transact Life Insurance Business. ecosystem of a financial market and providing insurance solutions to a global clientele. IFSCA (Assets, Liabilities, and Solvency Margin of General, Health and Re-insurance IFSCA has enacted a world class and comprehensive regulatory framework for the insurers, business) Regulations, 2023 reinsurers, and insurance intermediaries in IFSC focusing on ease of doing business. These The regulations aim to specify the requirements related to capital, solvency, and submission of regulations cover the aspects relating to registration of insurance business, manner of receipt abstract of actuarial report by an IIO, who are permitted to transact General, Health and Re- of premium, designing of insurance products, investment of assets, preparation and insurance business. presentation of financial statements, appointment and duties of appointed actuary, maintenance of information and records for inspection and investigation, inward and IFSCA (Management Control, Administrative Control and Market Conduct of outward reinsurance operations, solvency margin etc. insurance business) Regulations, 2023 While the growth in the domestic insurance market will enhance insurance inclusion and The regulations aim to put in place the regulatory framework related to Management Control, enable building large pools for Indian insurers, it also necessitates developing reinsurance Administrative Control and Market Conduct of insurance business carried out by an IIO or IIIO. capacities. GIFT IFSC, with its incentives and regulatory support, is well-positioned to develop Amendment to IFSCA (Investment by IIO) Regulations, 2022 these capacities for both Indian and global markets. Additionally, the global Indian diaspora offers significant opportunities for insurance entities to provide tailored health, life, and Considering the significance of investment income for insurers and re-insurers, IFSCA in travel insurance products by establishing operations in GIFT IFSC. accordance with Section 27 of the Insurance Act, 1938, had notified IFSCA (Investments by IIO) Regulations, 2022 on January 12, 2023. Subsequently, IRDAI on August 22, 2023, had notified Currently, the insurance ecosystem in IFSC comprises of 35 entities, including 12 IIOs (IFSC amendment to its Re-insurance Regulations, 2018. These regulations place IIO at par with Foreign Insurance Offices) and 23 IIIOs (IFSC Insurance Intermediary Offices). The total (Re)insurance Reinsurer Branch in Category 2 of Order of Preference subject to certain conditions on premium booked by IIOs is USD 360 Mn and the total (Re)insurance premium transacted by investments to be made in Domestic Tariff Area (DTA) in India. IIIOs is USD 918 Mn, up to March 2024. Based on the above amendment by the IRDAI, IFSCA had carried out suitable modifications to IFSCA (Investment by IIO) Regulations, 2022 and a consolidated version of the updated amended regulations has been made available on the website of the Authority. Policy/ Regulatory Developments Public consultation on various operational guidelines for IIOs To enable the rapid growth of insurance and re-insurance sector in GIFT IFSC, IFSCA has created a In December 2023, IFSCA placed following consultation papers for public consultation on its favourable regulatory environment. With thirteen regulations already in place canvassing most of website: the regulatory space, IFSCA has adopted a principles-based approach, in line with global best (i) Consultation paper on proposed Guidelines on IFSCA (Assets, Liabilities, and Solvency Margin practices. In the FY 2023-24, the following regulations were notified: of General, Health and Re-insurance business) Regulations, 2023 IFSCA (Re-insurance) Regulations, 2023 (ii) Consultation paper on proposed Guidelines on IFSCA (Assets, Liabilities, and Solvency Margin The regulations provide framework on oversight and control of inward and outward arrangement of Life insurance business) Regulations, 2023 of re-insurance business by the IIOs. The regulations require Board approved policy on Re- These guidelines provide reporting formats pertaining to requirements towards maintenance of insurance Strategy and Re-insurance Program (RSRP). capital and solvency margins for transacting insurance business by IIOs. As per IRDAI's framework, released in August 2023, IIOs at GIFT IFSC are placed in Category-2, i.e. at par with Foreign Re-insurance Branches (FRBs) in the Order of Preference, subject to certain Working Group/ Committee investment conditions. This marks a significant milestone since it would further enhance the prospects of GIFT IFSC to become a Global Reinsurance Hub. The extant IFSCA regulatory framework recognizes alternate risk transfer (ART) arrangements in the Re-insurance contract, subject to adherence with risk transfer requirements in such ART and accounting treatments for such transactions. 72 732023-24 On this matter the IFSCA has constituted a working group in March 2023 to study international Figure 13 : Classification of IIIOs best practices on Insurance Linked Securities (ILS), Catastrophe Bonds (CAT Bonds) etc. The members of the working group have experience in from global jurisdictions including but not 1 limited to UK, USA, EU, Bermuda, Japan, Singapore, Australia etc. and have expertise in CAT bonds, ILS, reinsurance sidecars, industry loss warranties and weather derivative contracts. The objective behind the creation of the working group is to advise IFSCA in structuring ART along with study of the regulatory framework / process in other jurisdictions and formalize draft of operational guidelines for ART. It will also help IFSCA to examine the offer of ART solutions within India and International jurisdictions and frame suitable accounting and supervision standards on par with best global practices for such ART contracts. 22 Transaction/ Processes/ Operations/ Trends Direct Insurance Broker Composite Broker Registration of entities Business Transactions at the IFSC The insurance sector in GIFT IFSC has got a major fillip since the IFSCA took various initiatives both in regulatory as well as developmental parlance with support from Government. Total IFSC Insurance Office (IIO) number of IIOs registered with GIFT IFSC have doubled since the previous financial year from 6 to 12. Following Figure represents the classification of IIOs in IFSC: In the FY 2023-24, the IIOs had booked premium of USD 149 Mn as against of USD 83 Mn in FY 2022-23. The Financial year wise business underwritten by the IIOs for previous 5 years is as Figure 12 : Classification of IIOs under: Figure 14 : Business underwritten by IIOs (USD Mn) 3 4 2023-24* 149 2022-23 83.26 2 2021-22 74.86 3 2020-21 18.6 Life Insurer General Insurer Health Insurer Re-Insurer 2019-20 16.6 It is noteworthy that out of 6 new IIOs registered in FY 2023-24, 3 of them are from life insurance 0 20 40 60 80 100 120 140 160 sector, 2 are from health insurance sector and 1 foreign re-insurer. Further, registration for 3 life * Data for FY 2023-24 is Provisional insurance companies is under process. The numbers primarily show an increasing interest among the life insurance companies to tap the needs of life insurance products for the Indian diaspora. IFSC Insurance Intermediary Office (IIIO) This would further enable GIFT IFSC to become a gateway to life insurance for Indian diaspora. In the FY 2023-24, the IIOs had transacted (re)insurance premium of USD 276 Mn as against of Further, on the side of IIIOs, IFSCA gave registration to 6 insurance intermediaries in FY 2023-24, USD 227 Mn in FY 2022-23. The Financial year wise transactions of IIIOs for previous 5 years is as raising the total number of registered IIIOs to 23. Following Figure represents the classification of under: IIIOs in IFSC: 74 752023-24 On this matter the IFSCA has constituted a working group in March 2023 to study international Figure 13 : Classification of IIIOs best practices on Insurance Linked Securities (ILS), Catastrophe Bonds (CAT Bonds) etc. The members of the working group have experience in from global jurisdictions including but not 1 limited to UK, USA, EU, Bermuda, Japan, Singapore, Australia etc. and have expertise in CAT bonds, ILS, reinsurance sidecars, industry loss warranties and weather derivative contracts. The objective behind the creation of the working group is to advise IFSCA in structuring ART along with study of the regulatory framework / process in other jurisdictions and formalize draft of operational guidelines for ART. It will also help IFSCA to examine the offer of ART solutions within India and International jurisdictions and frame suitable accounting and supervision standards on par with best global practices for such ART contracts. 22 Transaction/ Processes/ Operations/ Trends Direct Insurance Broker Composite Broker Registration of entities Business Transactions at the IFSC The insurance sector in GIFT IFSC has got a major fillip since the IFSCA took various initiatives both in regulatory as well as developmental parlance with support from Government. Total IFSC Insurance Office (IIO) number of IIOs registered with GIFT IFSC have doubled since the previous financial year from 6 to 12. Following Figure represents the classification of IIOs in IFSC: In the FY 2023-24, the IIOs had booked premium of USD 149 Mn as against of USD 83 Mn in FY 2022-23. The Financial year wise business underwritten by the IIOs for previous 5 years is as Figure 12 : Classification of IIOs under: Figure 14 : Business underwritten by IIOs (USD Mn) 3 4 2023-24* 149 2022-23 83.26 2 2021-22 74.86 3 2020-21 18.6 Life Insurer General Insurer Health Insurer Re-Insurer 2019-20 16.6 It is noteworthy that out of 6 new IIOs registered in FY 2023-24, 3 of them are from life insurance 0 20 40 60 80 100 120 140 160 sector, 2 are from health insurance sector and 1 foreign re-insurer. Further, registration for 3 life * Data for FY 2023-24 is Provisional insurance companies is under process. The numbers primarily show an increasing interest among the life insurance companies to tap the needs of life insurance products for the Indian diaspora. IFSC Insurance Intermediary Office (IIIO) This would further enable GIFT IFSC to become a gateway to life insurance for Indian diaspora. In the FY 2023-24, the IIOs had transacted (re)insurance premium of USD 276 Mn as against of Further, on the side of IIIOs, IFSCA gave registration to 6 insurance intermediaries in FY 2023-24, USD 227 Mn in FY 2022-23. The Financial year wise transactions of IIIOs for previous 5 years is as raising the total number of registered IIIOs to 23. Following Figure represents the classification of under: IIIOs in IFSC: 74 752023-24 Figure 15 : Business transacted by IIIOs (USD Mn) 2023-24* 276 2022-23 227 2021-22 223.45 2020-21 153.1 2019-20 42.4 0 50 100 150 200 250 300 * Data for FY 2023-24 is Provisional Image 19 : Dignitaries from IAIS and IFSCA during the signing of MMoU Advocacy and Outreach Meeting with FSA, Japan During visit to Japan, Mr. Miyoshi, Vice Commissioner, Financial Services Authority (FSA), Japan, Meetings with Insurance/ Re-insurance companies (Tokyo, Japan) welcomed the IFSCA delegation. Chairperson, IFSCA briefly mentioned the vision behind IFSC at A delegation led by Shri K. Rajaraman, Chairperson, IFSCA visited Tokyo, Japan in the second week GIFT City and various financial services businesses enabled in the IFSC. The delegation also of November 2023. During the visit, the delegation held meetings with various insurance/ re- participated in Japanese Financial Services Authority's (JFSA) High-Level Dialogue on the role of insurance companies. Detailed discussions were held on the specific enablers provided for insurance in building a resilient society, exploring how insurers and the public sector can Insurance Business, covering IFSCA's principle based regulatory framework on (re)insurance contribute to shaping a sustainable society for future generations, through collaborative and business, which is at par with global standards, promoting ease of doing business and business coordinated actions. Further, the matter of entering into bilateral MoU between IFSCA and JFSA opportunities in the GIFT IFSC. was discussed. Participation in Roadshow on Insurance organised by IRDAI IAIS AGM 2023 During IFSCA's delegation visit to Tokyo, The delegation also attended the IAIS Annual General Meeting Conference (AGM) 2023 on the the IRDAI had organised Roadshow for the theme “Mind the gap: the role of supervisors in making the global insurance sector more inclusive”. Japanese insurers at Vivekananda Cultural The conference provided an opportunity for updates on the delivery of the IAIS' Roadmap and Centre, Embassy of India at Tokyo, Japan. In plans for the Association's future work. the said roadshow, presentations were MMoU with IAIS made by Chairperson, IFSCA and Chairman, IRDAI on the opportunities provided by The major highlight of the Tokyo visit was the signing of Multilateral Memorandum of GIFT IFSC and the Insurance business in Understanding (MMoU) with IAIS. The IAIS MMoU provides a global framework of compliance and India for the Japanese investors and confidentiality to allow for open cooperation and exchange between insurance supervisors. To collaboration with Indian Insurance become a signatory to the MMoU, applicants undergo a rigorous assessment of their professional business. secrecy regimes, conducted by an independent team of IAIS members. Through membership in Image 20 : Chairperson, IFSCA, during Insurance the MMoU, supervisors can exchange relevant information and assist other signatories, thereby Roadshow at Tokyo, Japan promoting the financial stability and sound supervision of cross-border insurance operations for the benefit and protection of consumers. The IFSCA is 85th signatory to the IAIS MMoU. The Participation in 19 Singapore International Reinsurance Conference (SIRC) signing of this MMoU enables IFSCA to exchange relevant information with other signatory jurisdictions. IFSCA participated in 19 SIRC held during October 29 to November 03, 2023. The Conference had participation from around 2000+ delegates from 60 countries. During the tour, meetings were 76 772023-24 Figure 15 : Business transacted by IIIOs (USD Mn) 2023-24* 276 2022-23 227 2021-22 223.45 2020-21 153.1 2019-20 42.4 0 50 100 150 200 250 300 * Data for FY 2023-24 is Provisional Image 19 : Dignitaries from IAIS and IFSCA during the signing of MMoU Advocacy and Outreach Meeting with FSA, Japan During visit to Japan, Mr. Miyoshi, Vice Commissioner, Financial Services Authority (FSA), Japan, Meetings with Insurance/ Re-insurance companies (Tokyo, Japan) welcomed the IFSCA delegation. Chairperson, IFSCA briefly mentioned the vision behind IFSC at A delegation led by Shri K. Rajaraman, Chairperson, IFSCA visited Tokyo, Japan in the second week GIFT City and various financial services businesses enabled in the IFSC. The delegation also of November 2023. During the visit, the delegation held meetings with various insurance/ re- participated in Japanese Financial Services Authority's (JFSA) High-Level Dialogue on the role of insurance companies. Detailed discussions were held on the specific enablers provided for insurance in building a resilient society, exploring how insurers and the public sector can Insurance Business, covering IFSCA's principle based regulatory framework on (re)insurance contribute to shaping a sustainable society for future generations, through collaborative and business, which is at par with global standards, promoting ease of doing business and business coordinated actions. Further, the matter of entering into bilateral MoU between IFSCA and JFSA opportunities in the GIFT IFSC. was discussed. Participation in Roadshow on Insurance organised by IRDAI IAIS AGM 2023 During IFSCA's delegation visit to Tokyo, The delegation also attended the IAIS Annual General Meeting Conference (AGM) 2023 on the the IRDAI had organised Roadshow for the theme “Mind the gap: the role of supervisors in making the global insurance sector more inclusive”. Japanese insurers at Vivekananda Cultural The conference provided an opportunity for updates on the delivery of the IAIS' Roadmap and Centre, Embassy of India at Tokyo, Japan. In plans for the Association's future work. the said roadshow, presentations were MMoU with IAIS made by Chairperson, IFSCA and Chairman, IRDAI on the opportunities provided by The major highlight of the Tokyo visit was the signing of Multilateral Memorandum of GIFT IFSC and the Insurance business in Understanding (MMoU) with IAIS. The IAIS MMoU provides a global framework of compliance and India for the Japanese investors and confidentiality to allow for open cooperation and exchange between insurance supervisors. To collaboration with Indian Insurance become a signatory to the MMoU, applicants undergo a rigorous assessment of their professional business. secrecy regimes, conducted by an independent team of IAIS members. Through membership in Image 20 : Chairperson, IFSCA, during Insurance the MMoU, supervisors can exchange relevant information and assist other signatories, thereby Roadshow at Tokyo, Japan promoting the financial stability and sound supervision of cross-border insurance operations for the benefit and protection of consumers. The IFSCA is 85th signatory to the IAIS MMoU. The Participation in 19 Singapore International Reinsurance Conference (SIRC) signing of this MMoU enables IFSCA to exchange relevant information with other signatory jurisdictions. IFSCA participated in 19 SIRC held during October 29 to November 03, 2023. The Conference had participation from around 2000+ delegates from 60 countries. During the tour, meetings were 76 772023-24 held to discuss the GIFT IFSC Insurance proposition with global reinsurers. The participation Two panel discussions and two fire side chats were also held featuring eminent speakers and featured meeting with various stakeholders, insurance/ re-insurance companies. panellists from life, non-life and reinsurance segments of the industry. The themes of the panel discussions were ‘To develop India as Re-Insurance Hub’ and ‘IFSC: The Gateway to Life Insurance During the course of these meetings, many pertinent topics were discussed like Managing General for Indian Diaspora’ respectively. While the first fireside chat on “Unique opportunities in an Agents (MGAs), detailed presentation on the IFSC Insurance eco-system and enablers, emerging integrated jurisdiction” was held with Ms. Alice G. Vaidyan, Ex-CMD GIC; the second fireside chat, avenues for CBRs in IFSC, ILS, CAT bonds, captive insurance, development of segregated cell on “Lloyds in the Special Economic Zones”, was held with Mr. Shankar Garigiparthy, CEO & Country structures, Order of Preference as specified by Indian domestic regulator. Manager, Lloyd's India. IFSCA-IRDAI GIFT IFSC Global Reinsurance Summit Hon'ble Union Minister of Finance and Corporate Affairs had suggested IFSCA and IRDAI to jointly hold an event on the topic of Reinsurance with an aim to interact with the global reinsurers and develop GIFT IFSC as the Global Hub for Reinsurance. As a result, IFSCA, IRDAI and GIFT City with the support of Department of Financial Services (DFS), Ministry of Finance organised the "IFSCA- IRDAI GIFT IFSC Global Reinsurance Summit, 2023”, on November 30, 2023, in Mumbai. Image 22: Panel Discussion on “To develop India as Re-insurance Hub”. Dignitaries (Left to Right): Mr. Hitesh Kotak, CEO, Munich RE India Branch; Ms. Girija Subramanian, CMD, AICIL; Mr. Tapan Singhel, CEO, Bajaj Allianz General Insurance Co.; Mr. Arun Soundarajan, Country Head, Atradius India; Ms. T.L. Alamelu, Principal Advisor, IFSCA Parallelly, one-to-one meetings were organised between selective invitees which were attended by Dr. Hasmukh Adhia, Mr. Debashish Panda, Mr. K. Rajaraman, Mr. P. K. Arora, Mr. Praveen Trivedi, and Ms. T.L. Alamelu. Multitude of topics were taken up during these personal interactions like advantages of GIFT IFSC including tax benefits, access to Indian market, Order of Preference, Ease Image 21 : Dignitaries during the inaugural session “Vision Track”. Dignitaries (Left to Right): Mr. P. K. Arora, of Doing Business, etc. WTM, IRDAI; Dr. Vivek Joshi, Secretary, DFS; Dr. Hasmukh Adhia, Chairman, GIFT City; Mr. Debashish Panda, Chairman, IRDAI; Mr. K. Rajaraman, Chairperson, IFSCA; Mr. Praveen Trivedi, ED, IFSCA Policies and programs for the Following Year The objective of the Summit was inter-alia to bring all the stakeholders on a common platform and share with them the opportunities available in the GIFT IFSC and to find ways to make it a New segments of Insurance Industry in IFSC reinsurance hub. The Summit was also intended to create awareness of the principle-based In order to shape its vision of onshoring the offshore business in GIFT IFSC, the IFSCA aspires to regulatory system adopted by the regulator and to facilitate and handhold setting up of bring in globally renowned practices by onboarding concepts of Captive Insurance companies and (Re)insurance businesses in the GIFT IFSC. Mutual insurance companies. This will not only provide for fostering the growth of newer The Summit was attended by over 200 delegates and speakers, including top cross-border segments of insurance industry in IFSC, but also provide greater financial flexibility and protection reinsurers, Indian insurers and reinsurers including Foreign Reinsurance Branches, insurance to the entities and develop greater insurance/ re-insurance capacities. brokers, consultancy firms, lawyers, industry associations, and academic institutions. To nurture these emerging avenues, the IFSCA has recommended for amendments in the Presentations covered opportunities for insurance and reinsurance business at GIFT IFSC, the Insurance Act, 1938 for enabling registration of Captive and Mutual insurance companies. Upon business ecosystem, regulatory regime, efforts to promote ease of doing business, opportunities amendment in the Insurance Act, IFSCA plans to bring in suitable regulatory and supervisory for global reinsurers, and the unique features of GIFT IFSC such as forex, dedicated regulator, and frameworks in the forthcoming year. tax regime. 78 792023-24 held to discuss the GIFT IFSC Insurance proposition with global reinsurers. The participation Two panel discussions and two fire side chats were also held featuring eminent speakers and featured meeting with various stakeholders, insurance/ re-insurance companies. panellists from life, non-life and reinsurance segments of the industry. The themes of the panel discussions were ‘To develop India as Re-Insurance Hub’ and ‘IFSC: The Gateway to Life Insurance During the course of these meetings, many pertinent topics were discussed like Managing General for Indian Diaspora’ respectively. While the first fireside chat on “Unique opportunities in an Agents (MGAs), detailed presentation on the IFSC Insurance eco-system and enablers, emerging integrated jurisdiction” was held with Ms. Alice G. Vaidyan, Ex-CMD GIC; the second fireside chat, avenues for CBRs in IFSC, ILS, CAT bonds, captive insurance, development of segregated cell on “Lloyds in the Special Economic Zones”, was held with Mr. Shankar Garigiparthy, CEO & Country structures, Order of Preference as specified by Indian domestic regulator. Manager, Lloyd's India. IFSCA-IRDAI GIFT IFSC Global Reinsurance Summit Hon'ble Union Minister of Finance and Corporate Affairs had suggested IFSCA and IRDAI to jointly hold an event on the topic of Reinsurance with an aim to interact with the global reinsurers and develop GIFT IFSC as the Global Hub for Reinsurance. As a result, IFSCA, IRDAI and GIFT City with the support of Department of Financial Services (DFS), Ministry of Finance organised the "IFSCA- IRDAI GIFT IFSC Global Reinsurance Summit, 2023”, on November 30, 2023, in Mumbai. Image 22: Panel Discussion on “To develop India as Re-insurance Hub”. Dignitaries (Left to Right): Mr. Hitesh Kotak, CEO, Munich RE India Branch; Ms. Girija Subramanian, CMD, AICIL; Mr. Tapan Singhel, CEO, Bajaj Allianz General Insurance Co.; Mr. Arun Soundarajan, Country Head, Atradius India; Ms. T.L. Alamelu, Principal Advisor, IFSCA Parallelly, one-to-one meetings were organised between selective invitees which were attended by Dr. Hasmukh Adhia, Mr. Debashish Panda, Mr. K. Rajaraman, Mr. P. K. Arora, Mr. Praveen Trivedi, and Ms. T.L. Alamelu. Multitude of topics were taken up during these personal interactions like advantages of GIFT IFSC including tax benefits, access to Indian market, Order of Preference, Ease Image 21 : Dignitaries during the inaugural session “Vision Track”. Dignitaries (Left to Right): Mr. P. K. Arora, of Doing Business, etc. WTM, IRDAI; Dr. Vivek Joshi, Secretary, DFS; Dr. Hasmukh Adhia, Chairman, GIFT City; Mr. Debashish Panda, Chairman, IRDAI; Mr. K. Rajaraman, Chairperson, IFSCA; Mr. Praveen Trivedi, ED, IFSCA Policies and programs for the Following Year The objective of the Summit was inter-alia to bring all the stakeholders on a common platform and share with them the opportunities available in the GIFT IFSC and to find ways to make it a New segments of Insurance Industry in IFSC reinsurance hub. The Summit was also intended to create awareness of the principle-based In order to shape its vision of onshoring the offshore business in GIFT IFSC, the IFSCA aspires to regulatory system adopted by the regulator and to facilitate and handhold setting up of bring in globally renowned practices by onboarding concepts of Captive Insurance companies and (Re)insurance businesses in the GIFT IFSC. Mutual insurance companies. This will not only provide for fostering the growth of newer The Summit was attended by over 200 delegates and speakers, including top cross-border segments of insurance industry in IFSC, but also provide greater financial flexibility and protection reinsurers, Indian insurers and reinsurers including Foreign Reinsurance Branches, insurance to the entities and develop greater insurance/ re-insurance capacities. brokers, consultancy firms, lawyers, industry associations, and academic institutions. To nurture these emerging avenues, the IFSCA has recommended for amendments in the Presentations covered opportunities for insurance and reinsurance business at GIFT IFSC, the Insurance Act, 1938 for enabling registration of Captive and Mutual insurance companies. Upon business ecosystem, regulatory regime, efforts to promote ease of doing business, opportunities amendment in the Insurance Act, IFSCA plans to bring in suitable regulatory and supervisory for global reinsurers, and the unique features of GIFT IFSC such as forex, dedicated regulator, and frameworks in the forthcoming year. tax regime. 78 792023-24 GLOBAL IN-HOUSE CENTRES Global Capability Centres CXO Meet in Mumbai Executive Director, IFSCA addressed the participants in Global Capability Centres CXO Meet organized by the ICICI Bank on August 17, 2023. While appraising the participants about the In the last two decades, India has emerged as a leading hub for Global In-house Centres (GICs) growth and opportunities of GICs at IFSC, Executive Director, IFSCA also emphasized the owing to its inherent strengths such as availability of highly skilled talent pool and importance of tapping on the vast talent pool and availing of the fiscal and non-fiscal incentives competitive cost of operations. Essentially, GICs are offshore centres that perform designated offered by both central and state governments. in-house functions for large corporates and organizations. Over the years, GICs have started playing a strategic role at global level and have evolved as innovation centres offering advanced services in areas such as analytics, risk management, fraud prevention, etc. To enable the GIC business in GIFT IFSC, the Central Government notified GICs as a financial service under the IFSCA Act, 2019 to provide services relating to financial products and financial services. Subsequently, IFSCA notified the Global In-House Centres Regulations, 2020 which permitted entities belonging to any financial services group to set up a GIC in the IFSC. There are multiple institutions that have established GICs in the GIFT IFSC. The establishment of IFSCA has significantly increased the number of financial sector entities relocating to IFSC in GIFT City. It has also streamlined the process of obtaining approval and licenses for operations within IFSC. This relocation would allow them to establish an entity under Image 23 : Shri Dipesh Shah, ED, IFSCA addressing in GCC (CXO Meet) the jurisdiction of a unified regulator, providing the flexibility to offer services that align with their IFSCA address in the GCC Summit in Bengaluru strategic goals and business objectives. Additionally, the tax incentives and exemption from FEMA regulations would offer these entities greater regulatory independence. Chief General Manager, IFSCA addressed the gathering in GCC X Summit organised by the 3AI on July 21, 2023, at Bangalore. CGM, IFSCA appraised them about the opportunities in Global Inhouse Several institutions have already set up GICs within GIFT IFSC, collectively employing over 2600 Centres at GIFT IFSC. individuals. Major MNCs from the financial sector, including renowned banks like Bank of America, IFSCA address in Summit on “Opportunities for GCCs in the GIFT City” in Bengaluru auditing and assurance service providers, and securities and capital market firms, have established their GICs in GIFT IFSC. Executive Director, IFSCA delivered a keynote address at the “Opportunities for GCCs in the GIFT City” – an event organised by the HSBC Bank on July 28, 2023, at Bangalore. CGM, IFSCA Advocacy and Outreach participated in the panel discussion and expressed his views about the benefits to BFSI GCCs to establish in IFSC. IFSCA has been proactively involved in industry engagement and has forged collaborations with government agencies and GIFT City authorities. Consistent efforts have been directed towards Policies and Programs for the following year furnishing the requisite infrastructure essential for accommodating large corporations. Significant progress has been achieved within GIFT IFSC, particularly in areas such as office space Review of IFSCA (Global In-house Centres) Regulations, 2020 provision, transportation facilities, recreational amenities, and more. IFSCA has received suggestion on various provisions related to transfer of manpower and service receipt. Based on the suggested received, the regulations will be reviewed to incorporate Roundtable discussions with leading Global Capability Centres in India Chaired by appropriate changes. Hon'ble Finance Minister of India Increasing awareness about GIC ecosystem in GIFT IFSC In the presence of Hon'ble Finance Minister, roundtable discussions with the leaders of prominent BFSI Global Capability Centres and other stakeholders such as NASSCOM, GIFT City etc. was In close partnership with the Government of Gujarat, awareness campaigns and branding events organized on January 23, 2024, at New Delhi. During the discussion, leaders of leading BFSI MNC will be organized to highlight GIFT IFSC as a premier destination for GICs in the country. To expand GICs were apprised about the opportunities in GIFT IFSC and views were solicited on enablers outreach and engage with potential investors, physical roadshows will be conducted across required to develop GIFT IFSC as a GIC hub. Chairman, GIFT City, Chairperson, IFSCA, NASSCOM various prominent Indian cities that have already established themselves as leaders in the GIC leadership and leaders from more than 20 leading BFSI MNCs participated in the summit. sector. These coordinated endeavours aim to position GIFT IFSC as the preferred choice for GICs, leveraging its robust ecosystem and strategic advantages. 80 812023-24 GLOBAL IN-HOUSE CENTRES Global Capability Centres CXO Meet in Mumbai Executive Director, IFSCA addressed the participants in Global Capability Centres CXO Meet organized by the ICICI Bank on August 17, 2023. While appraising the participants about the In the last two decades, India has emerged as a leading hub for Global In-house Centres (GICs) growth and opportunities of GICs at IFSC, Executive Director, IFSCA also emphasized the owing to its inherent strengths such as availability of highly skilled talent pool and importance of tapping on the vast talent pool and availing of the fiscal and non-fiscal incentives competitive cost of operations. Essentially, GICs are offshore centres that perform designated offered by both central and state governments. in-house functions for large corporates and organizations. Over the years, GICs have started playing a strategic role at global level and have evolved as innovation centres offering advanced services in areas such as analytics, risk management, fraud prevention, etc. To enable the GIC business in GIFT IFSC, the Central Government notified GICs as a financial service under the IFSCA Act, 2019 to provide services relating to financial products and financial services. Subsequently, IFSCA notified the Global In-House Centres Regulations, 2020 which permitted entities belonging to any financial services group to set up a GIC in the IFSC. There are multiple institutions that have established GICs in the GIFT IFSC. The establishment of IFSCA has significantly increased the number of financial sector entities relocating to IFSC in GIFT City. It has also streamlined the process of obtaining approval and licenses for operations within IFSC. This relocation would allow them to establish an entity under Image 23 : Shri Dipesh Shah, ED, IFSCA addressing in GCC (CXO Meet) the jurisdiction of a unified regulator, providing the flexibility to offer services that align with their IFSCA address in the GCC Summit in Bengaluru strategic goals and business objectives. Additionally, the tax incentives and exemption from FEMA regulations would offer these entities greater regulatory independence. Chief General Manager, IFSCA addressed the gathering in GCC X Summit organised by the 3AI on July 21, 2023, at Bangalore. CGM, IFSCA appraised them about the opportunities in Global Inhouse Several institutions have already set up GICs within GIFT IFSC, collectively employing over 2600 Centres at GIFT IFSC. individuals. Major MNCs from the financial sector, including renowned banks like Bank of America, IFSCA address in Summit on “Opportunities for GCCs in the GIFT City” in Bengaluru auditing and assurance service providers, and securities and capital market firms, have established their GICs in GIFT IFSC. Executive Director, IFSCA delivered a keynote address at the “Opportunities for GCCs in the GIFT City” – an event organised by the HSBC Bank on July 28, 2023, at Bangalore. CGM, IFSCA Advocacy and Outreach participated in the panel discussion and expressed his views about the benefits to BFSI GCCs to establish in IFSC. IFSCA has been proactively involved in industry engagement and has forged collaborations with government agencies and GIFT City authorities. Consistent efforts have been directed towards Policies and Programs for the following year furnishing the requisite infrastructure essential for accommodating large corporations. Significant progress has been achieved within GIFT IFSC, particularly in areas such as office space Review of IFSCA (Global In-house Centres) Regulations, 2020 provision, transportation facilities, recreational amenities, and more. IFSCA has received suggestion on various provisions related to transfer of manpower and service receipt. Based on the suggested received, the regulations will be reviewed to incorporate Roundtable discussions with leading Global Capability Centres in India Chaired by appropriate changes. Hon'ble Finance Minister of India Increasing awareness about GIC ecosystem in GIFT IFSC In the presence of Hon'ble Finance Minister, roundtable discussions with the leaders of prominent BFSI Global Capability Centres and other stakeholders such as NASSCOM, GIFT City etc. was In close partnership with the Government of Gujarat, awareness campaigns and branding events organized on January 23, 2024, at New Delhi. During the discussion, leaders of leading BFSI MNC will be organized to highlight GIFT IFSC as a premier destination for GICs in the country. To expand GICs were apprised about the opportunities in GIFT IFSC and views were solicited on enablers outreach and engage with potential investors, physical roadshows will be conducted across required to develop GIFT IFSC as a GIC hub. Chairman, GIFT City, Chairperson, IFSCA, NASSCOM various prominent Indian cities that have already established themselves as leaders in the GIC leadership and leaders from more than 20 leading BFSI MNCs participated in the summit. sector. These coordinated endeavours aim to position GIFT IFSC as the preferred choice for GICs, leveraging its robust ecosystem and strategic advantages. 80 812023-24 SUSTAINABLE FINANCE Table 24 : Listing of debt securities at IFSC Exchanges (In USD Bn) Particulars As on Dec 31, 2023 As on Mar 31, 2024 Cumulative debt listings 52.97 56.5 Hon'ble Prime Minister of India, in Conference of Parties 26 (COP26) summit, announced Cumulative ESG labelled debt listing 10.43 12.3 'Panchamrits' as an unprecedented contribution of India to climate action. He said that India will aim to achieve net-zero emissions by 2070. India will require a funding to the tune of USD 10 trillion to meet the net-zero transition by 2070. Figure 16 : Listing of ESG Debt securities as of March 31, 2024 (In USD Bn) IFSCA has opened following three tracks for Sustainable Finance 8 7.06 (a) Lending by IFSC Banking Units and Finance Companies/Units in IFSC under Guidance 7 Framework for Sustainable and Sustainability linked lending 6 (b) Separate Regulatory Framework for Listing of ESG labelled Debt securities under IFSCA 5 (Issuance and Listing of Securities) Regulations 4 2.64 3 (c) Enablement of launch of sustainability focused investment funds in IFSC (ESG Funds) 1.9 2 0.7 1 Policy/ Regulatory Development 0 Listing USD Bn The vision of the Hon'ble Prime Minister and the Government of India is to make GIFT IFSC, the Green Sustainable Sustainability-lineked Social global hub for sustainable finance. IFSCA, as a unified regulator for GIFT IFSC, is working with a vision to achieve these objectives. In the past 3 years, IFSCA has taken significant steps in Figure 17 : Listing of Debt securities as of March 31, 2024 (In USD Bn) accelerating global sustainable capital flows by creating a conducive regulatory environment, inspired by international best practices but focused especially on the needs of developing 20 18.18 countries. 18 The Authority has taken various regulatory and policy initiatives to mobilise finance towards 16 green and sustainable projects, including the following: 14 11.37 (i) Guidance Framework for Sustainable and Sustainability linked lending by Financial 12 7.41 Institutions 10 (ii) Sustainability Disclosures by Fund Management Entities 8 5.83 (iii) Framework for ESG Schemes 5.54 5.35 6 (iv) Separate regulatory framework for ESG labelled debt securities in IFSCA (Issuance and Listing 2.8 4 of Securities) Regulations 2 0 Transaction/Processes/Operations/Trends Issuance in USD Bn 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 Debt Securities As on March 31, 2024, USD 12.3 Bn ESG labelled debt securities have been listed on the IFSC exchanges and total listing of debt securities on IFSC exchanges stands at USD 56.6 Bn. REC Limited listed its inaugural JPY 61.1 Bn 5-year, 5.25-year, and 10-year green bonds, issued under its USD 10 Bn Global Medium Term Notes Programme, on IFSC exchanges in January 2024. It is the largest ever Euro-Yen issuance in South and Southeast Asia, the largest Yen-denominated issuance from India, and the largest non-sovereign Yen-denominated issuance ever from South and Southeast Asia. 82 832023-24 SUSTAINABLE FINANCE Table 24 : Listing of debt securities at IFSC Exchanges (In USD Bn) Particulars As on Dec 31, 2023 As on Mar 31, 2024 Cumulative debt listings 52.97 56.5 Hon'ble Prime Minister of India, in Conference of Parties 26 (COP26) summit, announced Cumulative ESG labelled debt listing 10.43 12.3 'Panchamrits' as an unprecedented contribution of India to climate action. He said that India will aim to achieve net-zero emissions by 2070. India will require a funding to the tune of USD 10 trillion to meet the net-zero transition by 2070. Figure 16 : Listing of ESG Debt securities as of March 31, 2024 (In USD Bn) IFSCA has opened following three tracks for Sustainable Finance 8 7.06 (a) Lending by IFSC Banking Units and Finance Companies/Units in IFSC under Guidance 7 Framework for Sustainable and Sustainability linked lending 6 (b) Separate Regulatory Framework for Listing of ESG labelled Debt securities under IFSCA 5 (Issuance and Listing of Securities) Regulations 4 2.64 3 (c) Enablement of launch of sustainability focused investment funds in IFSC (ESG Funds) 1.9 2 0.7 1 Policy/ Regulatory Development 0 Listing USD Bn The vision of the Hon'ble Prime Minister and the Government of India is to make GIFT IFSC, the Green Sustainable Sustainability-lineked Social global hub for sustainable finance. IFSCA, as a unified regulator for GIFT IFSC, is working with a vision to achieve these objectives. In the past 3 years, IFSCA has taken significant steps in Figure 17 : Listing of Debt securities as of March 31, 2024 (In USD Bn) accelerating global sustainable capital flows by creating a conducive regulatory environment, inspired by international best practices but focused especially on the needs of developing 20 18.18 countries. 18 The Authority has taken various regulatory and policy initiatives to mobilise finance towards 16 green and sustainable projects, including the following: 14 11.37 (i) Guidance Framework for Sustainable and Sustainability linked lending by Financial 12 7.41 Institutions 10 (ii) Sustainability Disclosures by Fund Management Entities 8 5.83 (iii) Framework for ESG Schemes 5.54 5.35 6 (iv) Separate regulatory framework for ESG labelled debt securities in IFSCA (Issuance and Listing 2.8 4 of Securities) Regulations 2 0 Transaction/Processes/Operations/Trends Issuance in USD Bn 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 Debt Securities As on March 31, 2024, USD 12.3 Bn ESG labelled debt securities have been listed on the IFSC exchanges and total listing of debt securities on IFSC exchanges stands at USD 56.6 Bn. REC Limited listed its inaugural JPY 61.1 Bn 5-year, 5.25-year, and 10-year green bonds, issued under its USD 10 Bn Global Medium Term Notes Programme, on IFSC exchanges in January 2024. It is the largest ever Euro-Yen issuance in South and Southeast Asia, the largest Yen-denominated issuance from India, and the largest non-sovereign Yen-denominated issuance ever from South and Southeast Asia. 82 832023-24 Table 25 : Debt listing in FY 2023-24 Table 26 : Overall Sustainable Financing by IBUs Amount of Cumulative in FY 2023-24 Issued issuance in Classification (USD Mn) Name of the issuer Listing Date Label Currency issued currency Green 436.31 (in Mn) Social 577.09 State bank of India 1-1-2024 USD 250.00 Green Sustainable 245.80 State bank of India 18-1-2024 USD 600.00 - Sustainability Linked 279.39 NeoGrowth Credit Private 19-1-2024 Euro 4.00 - Limited Others 23.75 REC Limited 22-1-2024 JPY 27,400.00 Green Total 1562.34 REC Limited 22-1-2024 JPY 31,000.00 Green Table 27 : Sector-wise classification of Sustainable Financing by IBUs REC Limited 22-1-2024 JPY 2700.00 Green During FY 2023-24 Shriram Finance Limited 25-1-2024 USD 750.00 Social Sector (List is Indicative) Amount (USD Mn) Total No. of Transactions HDFC Bank Limited 16-2-2024 USD 300.00 Sustainable Renewable Energy 419.83 368 HDFC Bank Limited 16-2-2024 USD 450.00 - Pollution Prevention and Control 141.67 2 IRB Infrastructure 13-3-2024 USD 540.00 - Developers Limited Sustainable Water and Wastewater Management 0.00 0 Aviom India Housing Clean Transportation 70.78 8 13-3-2024 USD 5.00 - Finance Private Limited Green Buildings 1.50 1 Adani Green Energy (UP) Affordable Basic Infrastructure 57.74 2 Limited, Parampujya Affordable Housing 9.46 12 Solar Energy Private 13-3-2024 USD 409.00 Green Limited and Prayatna Food Security and Sustainable Food Systems 11.76 16 Developers Private Health Care 52.01 48 Limited Social Education 7.00 2 Aye Finance Private 21-3-2024 USD 11.50 - Others 790.59 828 Limited Total 1562.33 1287 It is observed that in the FY 2023-24, due to global macroeconomic situation, Indian corporates Funds have majorly raised capital through bond market domestically. Because of that, the year has witnessed drastic reduction in foreign currency debt issuances by Indian corporates. With the objective to promote ESG funds and drive capital flows towards green and sustainable Loans projects in India, IFSCA has issued the regulatory framework for ESG Funds covering requirements relating to initial and periodic disclosures, ongoing monitoring, and performance The IFSCA has issued a “Guidance Framework for Sustainable and Sustainability linked lending by evaluation. The framework enabled the registration of the first ESG engagement fund at IFSC. The Financial Institutions” on April 26, 2022, to promote sustainable lending by IBUs and FCs. The significant growth of fund ecosystem at IFSC, in the last financial year, presents a huge opportunity banking units are also mandated to allocate at least 5% of their loans towards green, or sustainable for ESG Funds at IFSC. sectors/ facilities, starting from April 01, 2023. In the first year of implementation of this framework, IBUs in IFSC has undertaken approximately USD 1.56 Bn of sustainable lending transactions. Details of which are as follows. 84 852023-24 Table 25 : Debt listing in FY 2023-24 Table 26 : Overall Sustainable Financing by IBUs Amount of Cumulative in FY 2023-24 Issued issuance in Classification (USD Mn) Name of the issuer Listing Date Label Currency issued currency Green 436.31 (in Mn) Social 577.09 State bank of India 1-1-2024 USD 250.00 Green Sustainable 245.80 State bank of India 18-1-2024 USD 600.00 - Sustainability Linked 279.39 NeoGrowth Credit Private 19-1-2024 Euro 4.00 - Limited Others 23.75 REC Limited 22-1-2024 JPY 27,400.00 Green Total 1562.34 REC Limited 22-1-2024 JPY 31,000.00 Green Table 27 : Sector-wise classification of Sustainable Financing by IBUs REC Limited 22-1-2024 JPY 2700.00 Green During FY 2023-24 Shriram Finance Limited 25-1-2024 USD 750.00 Social Sector (List is Indicative) Amount (USD Mn) Total No. of Transactions HDFC Bank Limited 16-2-2024 USD 300.00 Sustainable Renewable Energy 419.83 368 HDFC Bank Limited 16-2-2024 USD 450.00 - Pollution Prevention and Control 141.67 2 IRB Infrastructure 13-3-2024 USD 540.00 - Developers Limited Sustainable Water and Wastewater Management 0.00 0 Aviom India Housing Clean Transportation 70.78 8 13-3-2024 USD 5.00 - Finance Private Limited Green Buildings 1.50 1 Adani Green Energy (UP) Affordable Basic Infrastructure 57.74 2 Limited, Parampujya Affordable Housing 9.46 12 Solar Energy Private 13-3-2024 USD 409.00 Green Limited and Prayatna Food Security and Sustainable Food Systems 11.76 16 Developers Private Health Care 52.01 48 Limited Social Education 7.00 2 Aye Finance Private 21-3-2024 USD 11.50 - Others 790.59 828 Limited Total 1562.33 1287 It is observed that in the FY 2023-24, due to global macroeconomic situation, Indian corporates Funds have majorly raised capital through bond market domestically. Because of that, the year has witnessed drastic reduction in foreign currency debt issuances by Indian corporates. With the objective to promote ESG funds and drive capital flows towards green and sustainable Loans projects in India, IFSCA has issued the regulatory framework for ESG Funds covering requirements relating to initial and periodic disclosures, ongoing monitoring, and performance The IFSCA has issued a “Guidance Framework for Sustainable and Sustainability linked lending by evaluation. The framework enabled the registration of the first ESG engagement fund at IFSC. The Financial Institutions” on April 26, 2022, to promote sustainable lending by IBUs and FCs. The significant growth of fund ecosystem at IFSC, in the last financial year, presents a huge opportunity banking units are also mandated to allocate at least 5% of their loans towards green, or sustainable for ESG Funds at IFSC. sectors/ facilities, starting from April 01, 2023. In the first year of implementation of this framework, IBUs in IFSC has undertaken approximately USD 1.56 Bn of sustainable lending transactions. Details of which are as follows. 84 852023-24 Advocacy and outreach In the inaugural address, the Chairperson, IFSCA emphasized the organization's wide-ranging initiatives in financial markets, particularly in sustainable finance. Citing the Prime Minister's MoU with Climate Policy Initiative - India (CPI) comments at the IFSCA InFinity Forum 2.0, the Chairperson highlighted India's need for at least USD 10 trillion to reach its net-zero emissions goal by 2070. The Chairperson also highlighted the IFSCA and CPI have signed an MoU on July 06, 2023, for mutual assistance and cooperation to government's ambitious plan to transform India into a developed nation by 2047, emphasizing the increase mobilization of global sustainable capital flows into India. Mobilization of green/ significant opportunities for green growth that is present. Achieving these goals will require sustainable/ climate finance is critical to achieve transition to green and resilient economies. innovative changes in policy, regulations, and market structures. The Chairperson expressed that IFSCA has taken significant steps in accelerating global sustainable capital flows by creating a the round table conference would aid IFSCA in fostering an environment conducive to mobilizing conducive regulatory environment, based on international best practices, focused especially on capital through climate finance and carbon market mechanisms. the needs of India, and other developing countries. CPI's mission is to help governments, FICCI ESG Summit 2023 businesses, and financial institutions drive economic growth while addressing climate change. It is against this backdrop that IFSCA and CPI are collaborating through a wide-ranging MoU, which The FICCI ESG Summit 2023, on the theme of driving sustainable transformation took place on includes research and joint convenings in the field of sustainable finance. October 9, 2023, in Mumbai. At the FICCI ESG Summit, the Chairperson, IFSCA, emphasized the critical role of sustainable and climate finance amidst the growing climate risks. The Chairperson IFSCA and G20 discussed the evolving global regulatory landscape for sustainable finance and highlighted IFSCA's IFSCA contributed towards India's G20 Presidency by being a domestic knowledge partner of G20 initiatives, including the regulatory framework for listing Green, Social, and Sustainability (GSS+) Sustainable Finance Working Group (SFWG), in alignment to IFSCA's ambition of developing GIFT bonds, sustainability lending by IBUs, sustainability reporting by FMEs, and the establishment of IFSC as a global hub for sustainable finance. Some of the significant contributions are highlighted ESG funds at GIFT IFSC. below. Emphasizing that IFSCA's regulations are globally aligned yet sensitive to the needs of developing (i) IFSCA is one of the lead authors for India's Presidency Input paper on “Building capacities to nations like India, the Chairperson pointed out their significance in attracting foreign capital to accelerate sustainable finance and manage climate and sustainability risk” published as part green and sustainable projects in India. Furthermore, ongoing efforts to develop the 'Voluntary of work related to G20 SFWG. Carbon Market' and 'Transition Finance' instruments were noted, aimed at supporting financing for corporates in India and the broader Global South. (ii) IFSCA participated in panel discussions related to social impact investments and capacity building during the G20 Domestic outreach event at Chennai. MoEFCC Climate Conference 2024 (iii) IFSCA provided its inputs for scaling up adoption of social impact investment for one of the The Climate Conference 2024, themed "Decoding the Green Transition for India," took place on priority areas of G20 SFWG. January 12, 2024, in Mumbai. The Conference was organised by MoEFCC under the Green Climate Fund Readiness Programme with Delivery Partner UNDP India and supported by Knowledge (iv) IFSCA shared case studies at IFSC as instruments for financing Sustainable Development Goals Partner Avaana Capital. (SDGs) for consideration to be part of compendium of best practices for financing SDGs. Chairperson, IFSCA delivered the speech at Climate Conference 2024. He emphasized on bridging Round Table Conference on International Carbon Markets the financing gap for climate action, estimated at USD 2.5 trillion and said IFSCA can act as a On December 13, 2023, IFSCA, in collaboration with FICCI and NSE, hosted a round table gateway for attracting global capital towards sustainable projects in India. He mentioned about conference titled "International Carbon Market: Making GIFT IFSC a Gateway for Global Climate the various initiatives taken by IFSCA to mobilize climate and sustainable finance from GIFT IFSC. Finance" at GIFT City, Gandhinagar. The event brought together dignitaries from the Ministry of He also highlighted the major ongoing initiatives by IFSCA to develop “Voluntary Carbon Market” Power, Ministry of Finance, corporate leaders, academic institutions, carbon exchanges, and other ecosystem at GIFT IFSC and “Framework for Transition Finance” to support the financing of key stakeholders in the carbon market. The conference facilitated discussions on (a) Building the corporates in India and the Global South for their net-zero transition. Foundation for a Vibrant Carbon Market: Integrity, Infrastructure, and Innovation and (b) Enabling International Carbon Market at GIFT IFSC: Forging the Perfect Ecosystem. The goal was to identify critical elements for creating a transparent and dynamic carbon market, positioning GIFT IFSC as a premier destination for international carbon finance. 86 872023-24 Advocacy and outreach In the inaugural address, the Chairperson, IFSCA emphasized the organization's wide-ranging initiatives in financial markets, particularly in sustainable finance. Citing the Prime Minister's MoU with Climate Policy Initiative - India (CPI) comments at the IFSCA InFinity Forum 2.0, the Chairperson highlighted India's need for at least USD 10 trillion to reach its net-zero emissions goal by 2070. The Chairperson also highlighted the IFSCA and CPI have signed an MoU on July 06, 2023, for mutual assistance and cooperation to government's ambitious plan to transform India into a developed nation by 2047, emphasizing the increase mobilization of global sustainable capital flows into India. Mobilization of green/ significant opportunities for green growth that is present. Achieving these goals will require sustainable/ climate finance is critical to achieve transition to green and resilient economies. innovative changes in policy, regulations, and market structures. The Chairperson expressed that IFSCA has taken significant steps in accelerating global sustainable capital flows by creating a the round table conference would aid IFSCA in fostering an environment conducive to mobilizing conducive regulatory environment, based on international best practices, focused especially on capital through climate finance and carbon market mechanisms. the needs of India, and other developing countries. CPI's mission is to help governments, FICCI ESG Summit 2023 businesses, and financial institutions drive economic growth while addressing climate change. It is against this backdrop that IFSCA and CPI are collaborating through a wide-ranging MoU, which The FICCI ESG Summit 2023, on the theme of driving sustainable transformation took place on includes research and joint convenings in the field of sustainable finance. October 9, 2023, in Mumbai. At the FICCI ESG Summit, the Chairperson, IFSCA, emphasized the critical role of sustainable and climate finance amidst the growing climate risks. The Chairperson IFSCA and G20 discussed the evolving global regulatory landscape for sustainable finance and highlighted IFSCA's IFSCA contributed towards India's G20 Presidency by being a domestic knowledge partner of G20 initiatives, including the regulatory framework for listing Green, Social, and Sustainability (GSS+) Sustainable Finance Working Group (SFWG), in alignment to IFSCA's ambition of developing GIFT bonds, sustainability lending by IBUs, sustainability reporting by FMEs, and the establishment of IFSC as a global hub for sustainable finance. Some of the significant contributions are highlighted ESG funds at GIFT IFSC. below. Emphasizing that IFSCA's regulations are globally aligned yet sensitive to the needs of developing (i) IFSCA is one of the lead authors for India's Presidency Input paper on “Building capacities to nations like India, the Chairperson pointed out their significance in attracting foreign capital to accelerate sustainable finance and manage climate and sustainability risk” published as part green and sustainable projects in India. Furthermore, ongoing efforts to develop the 'Voluntary of work related to G20 SFWG. Carbon Market' and 'Transition Finance' instruments were noted, aimed at supporting financing for corporates in India and the broader Global South. (ii) IFSCA participated in panel discussions related to social impact investments and capacity building during the G20 Domestic outreach event at Chennai. MoEFCC Climate Conference 2024 (iii) IFSCA provided its inputs for scaling up adoption of social impact investment for one of the The Climate Conference 2024, themed "Decoding the Green Transition for India," took place on priority areas of G20 SFWG. January 12, 2024, in Mumbai. The Conference was organised by MoEFCC under the Green Climate Fund Readiness Programme with Delivery Partner UNDP India and supported by Knowledge (iv) IFSCA shared case studies at IFSC as instruments for financing Sustainable Development Goals Partner Avaana Capital. (SDGs) for consideration to be part of compendium of best practices for financing SDGs. Chairperson, IFSCA delivered the speech at Climate Conference 2024. He emphasized on bridging Round Table Conference on International Carbon Markets the financing gap for climate action, estimated at USD 2.5 trillion and said IFSCA can act as a On December 13, 2023, IFSCA, in collaboration with FICCI and NSE, hosted a round table gateway for attracting global capital towards sustainable projects in India. He mentioned about conference titled "International Carbon Market: Making GIFT IFSC a Gateway for Global Climate the various initiatives taken by IFSCA to mobilize climate and sustainable finance from GIFT IFSC. Finance" at GIFT City, Gandhinagar. The event brought together dignitaries from the Ministry of He also highlighted the major ongoing initiatives by IFSCA to develop “Voluntary Carbon Market” Power, Ministry of Finance, corporate leaders, academic institutions, carbon exchanges, and other ecosystem at GIFT IFSC and “Framework for Transition Finance” to support the financing of key stakeholders in the carbon market. The conference facilitated discussions on (a) Building the corporates in India and the Global South for their net-zero transition. Foundation for a Vibrant Carbon Market: Integrity, Infrastructure, and Innovation and (b) Enabling International Carbon Market at GIFT IFSC: Forging the Perfect Ecosystem. The goal was to identify critical elements for creating a transparent and dynamic carbon market, positioning GIFT IFSC as a premier destination for international carbon finance. 86 8722002233--2244 Policies and program for the Following Year Framework for Transition Finance The need of the hour is to fund the transition journey of all sectors, especially hard-to-abate sectors such as steel, cement, chemicals etc. In order to achieve the Paris agreement goals and SDGs. In this context, transition finance instruments such as transition bonds, transition loans etc. have emerged as an alternative to address the financing gap needed to achieve Paris agreement goals and which is inclusive of sectors and geographies across industries. IFSCA has formed an expert committee on Transition Finance consisting of representation from industry, standard setters, consultants, think tanks etc. to recommend a regulatory framework for transition finance instruments and measures to promote transition finance through GIFT IFSC. Regulatory framework for Voluntary Carbon Market India is one of the largest suppliers of carbon credits in International Voluntary Carbon Market Image 24 : Chairperson, IFSCA at the inaugural session of the climate conference over the last decade. With an aim to develop an ecosystem of international carbon market under a regulated environment, IFSCA has constituted an Expert Committee on Voluntary Carbon Market Working Group/ Committee chaired by Shri R.R. Rashmi. The committee includes experts from the areas of renewable energy, consultancy, capital markets, policy, legal, standards and registry, investors, etc. The terms of Expert Committee on Voluntary Carbon Market reference include recommendations to IFSCA for development of regulatory framework on VCM and suggest policy and enabling measures to create a robust VCM ecosystem for global markets at IFSCA, with a view to develop Voluntary Carbon Market ecosystem in GIFT IFSC, has constituted an GIFT IFSC. Expert Committee, chaired by Shri R. R. Rashmi, Distinguished Fellow and Programme Director, Earth Science and Climate Change, The Energy and Resources Institute (TERI) in September 2023. Investment and settlement of Sovereign Green Bonds (SGrBs) at IFSC The expert committee is tasked with comprehensively examining the international Voluntary With the objective of enabling the wider participation from foreign investors in India's green Carbon Market (VCM) to assess its potential for supporting India's Net Zero goals. This includes growth, IFSCA and RBI are working together to enable the trading and settlement of SGrBs at IFSC. understanding current VCM challenges and opportunities, suggesting policy measures to enable VCM within GIFT IFSC, attracting market participants, establishing a robust VCM ecosystem, and drafting a regulatory framework for VCM activity within GIFT IFSC. The scope also extends to any other relevant matters concerning VCM development and regulation at GIFT IFSC. Expert Committee on Climate Finance With the objective to mobilize global capital to achieve the net zero target of India and other emerging countries, IFSCA constituted an Expert Committee on Climate Finance in December 2023 under the Chairmanship of Mr. Dhruba Purkayastha (India Director, CPI). The expert committee is established to comprehensively analyse global climate financing trends, identify best practices, and assess requirement of climate Finance with special focus on transition in India by 2047. The committee will further recommend a regulatory framework for transition finance instruments, building upon IFSCA's draft framework. Additionally, the terms of reference for the committee include recommendations on policy measures (legal, tax, regulatory etc.) to promote transition finance through GIFT IFSC, and on building a cost-effective and reliable ecosystem for transition finance supporting Indian industry, while also providing a roadmap for GIFT IFSC to develop climate finance instruments and become a global hub. 88 8922002233--2244 Policies and program for the Following Year Framework for Transition Finance The need of the hour is to fund the transition journey of all sectors, especially hard-to-abate sectors such as steel, cement, chemicals etc. In order to achieve the Paris agreement goals and SDGs. In this context, transition finance instruments such as transition bonds, transition loans etc. have emerged as an alternative to address the financing gap needed to achieve Paris agreement goals and which is inclusive of sectors and geographies across industries. IFSCA has formed an expert committee on Transition Finance consisting of representation from industry, standard setters, consultants, think tanks etc. to recommend a regulatory framework for transition finance instruments and measures to promote transition finance through GIFT IFSC. Regulatory framework for Voluntary Carbon Market India is one of the largest suppliers of carbon credits in International Voluntary Carbon Market Image 24 : Chairperson, IFSCA at the inaugural session of the climate conference over the last decade. With an aim to develop an ecosystem of international carbon market under a regulated environment, IFSCA has constituted an Expert Committee on Voluntary Carbon Market Working Group/ Committee chaired by Shri R.R. Rashmi. The committee includes experts from the areas of renewable energy, consultancy, capital markets, policy, legal, standards and registry, investors, etc. The terms of Expert Committee on Voluntary Carbon Market reference include recommendations to IFSCA for development of regulatory framework on VCM and suggest policy and enabling measures to create a robust VCM ecosystem for global markets at IFSCA, with a view to develop Voluntary Carbon Market ecosystem in GIFT IFSC, has constituted an GIFT IFSC. Expert Committee, chaired by Shri R. R. Rashmi, Distinguished Fellow and Programme Director, Earth Science and Climate Change, The Energy and Resources Institute (TERI) in September 2023. Investment and settlement of Sovereign Green Bonds (SGrBs) at IFSC The expert committee is tasked with comprehensively examining the international Voluntary With the objective of enabling the wider participation from foreign investors in India's green Carbon Market (VCM) to assess its potential for supporting India's Net Zero goals. This includes growth, IFSCA and RBI are working together to enable the trading and settlement of SGrBs at IFSC. understanding current VCM challenges and opportunities, suggesting policy measures to enable VCM within GIFT IFSC, attracting market participants, establishing a robust VCM ecosystem, and drafting a regulatory framework for VCM activity within GIFT IFSC. The scope also extends to any other relevant matters concerning VCM development and regulation at GIFT IFSC. Expert Committee on Climate Finance With the objective to mobilize global capital to achieve the net zero target of India and other emerging countries, IFSCA constituted an Expert Committee on Climate Finance in December 2023 under the Chairmanship of Mr. Dhruba Purkayastha (India Director, CPI). The expert committee is established to comprehensively analyse global climate financing trends, identify best practices, and assess requirement of climate Finance with special focus on transition in India by 2047. The committee will further recommend a regulatory framework for transition finance instruments, building upon IFSCA's draft framework. Additionally, the terms of reference for the committee include recommendations on policy measures (legal, tax, regulatory etc.) to promote transition finance through GIFT IFSC, and on building a cost-effective and reliable ecosystem for transition finance supporting Indian industry, while also providing a roadmap for GIFT IFSC to develop climate finance instruments and become a global hub. 88 892023-24 ANCILLARY SERVICES Policy/ Regulatory Developments Framework for enabling Ancillary services at IFSC Professional services firms are quintessential for the development of an international Ancillary Services are defined as services which directly or indirectly aid, help, assist or strengthen financial centre as they aid and assist the delivery of financial services such as Audit and or are attendant upon or connected with 'services' as defined under section 3 of IFSCA Act, 2019. Accountancy, Taxation, Legal, Consulting and Advisory services etc. Globally, the growth of The permissible ancillary services under the framework are as follows: financial firms and financial markets are predicated on the growth and concentration of (i) Legal, Compliance and Secretarial high-quality professional services firms. (ii) Auditing, Accounting, Book-keeping and Taxation Services (iii) Professional & Management Consulting Services Considering the inherent importance of professional services firms in developing a robust (iv) Administration, Assets Management Support Services and Trusteeship Services financial services market in GIFT IFSC, IFSCA in February 2021 issued the framework for (v) Any other services as approved by IFSCA from time to time. enabling Ancillary Services at IFSC. (vi) The following entities are eligible to act as a service provider so as to provide permissible ancillary services pertaining to activities in relation to financial products, financial services The industry in GIFT IFSC is showing healthy growth having 68 entities as of March 31, 2024, and financial institutions in the IFSC: providing services across categories like Legal, Compliance and Secretarial, Professional & Management Consulting Services, Auditing, Accounting, Bookkeeping and Taxation Services, a. Any existing or newly incorporated entity set up in the IFSC. Administration, Asset Management Support Services and Trusteeship Services, etc b. Any Indian or foreign incorporated entity by establishing a branch or a subsidiary. The entity may be set up in the IFSC in the form of a company or a limited liability partnership or a registered partnership firm, branch thereof or any other form as may be approved by the IFSCA. International Financial Centres (IFCs) are regions characterized by a high concentration of Service providers can provide permissible services to any one or more of the following: financial service providers, including banks, capital market entities, insurance firms, fund managers, and FinTech companies. Additionally, these centres host professional service firms (i) Entities set up in IFSC. offering expertise in areas such as audit, accountancy, taxation, legal counsel, consulting, and (ii) Entities from foreign jurisdictions for various permissible ancillary services in IFSCs in India advisory services. The presence of professional service firms is crucial for the growth and or overseas (iii) Indian entities who propose to open, set up or carry out operations in IFSCs or foreign functionality of an international financial centre, as they support and facilitate the delivery of jurisdiction, provided consideration is received in freely convertible foreign currency. financial services by financial institutions. Globally, the expansion of financial firms and markets relies heavily on the proliferation and quality of professional service firms. Transaction/Processes/Operations/Trends Given the abundant availability of skilled professionals in India, particularly in fields such as Chartered Accountancy, Company Secretaryship, and Chartered Financial Analysis, there exists Under the Ancillary Framework, IFSCA has granted Authorisation to 68⁷² entities as on March 31, significant potential for the IFSC to emerge as a central hub for professional service providers. 2024, out of which 22 entities were granted authorization during Financial Year 2023-24. These professionals would not only serve the needs of the IFSC itself but also cater to demand from overseas markets. Recognizing the vital role of professional service providers in fostering the Table 28 : Activity-wise break up of Ancillary Services Entities development of financial markets within the GIFT IFSC, the Authority introduced the "Framework for Enabling Ancillary Services at International Financial Services Centres" in February 2021. S. No. of Authorized Entities Activity No. as on March 31, 2024 The implementation of ancillary service firms within the GIFT IFSC has greatly bolstered the 1 Legal, Compliance and Secretarial 12 growth of the financial services ecosystem by meeting the demand for professional services and 2 Professional & Management Consulting Services 21 attracting both global and domestic players to the IFSC. 3 Auditing, Accounting, Bookkeeping and Taxation Services 11 4 Administration, Asset Management Support Services 24 and Trusteeship Services Total 68 ⁷² Including in-principle approval 90 912023-24 ANCILLARY SERVICES Policy/ Regulatory Developments Framework for enabling Ancillary services at IFSC Professional services firms are quintessential for the development of an international Ancillary Services are defined as services which directly or indirectly aid, help, assist or strengthen financial centre as they aid and assist the delivery of financial services such as Audit and or are attendant upon or connected with 'services' as defined under section 3 of IFSCA Act, 2019. Accountancy, Taxation, Legal, Consulting and Advisory services etc. Globally, the growth of The permissible ancillary services under the framework are as follows: financial firms and financial markets are predicated on the growth and concentration of (i) Legal, Compliance and Secretarial high-quality professional services firms. (ii) Auditing, Accounting, Book-keeping and Taxation Services (iii) Professional & Management Consulting Services Considering the inherent importance of professional services firms in developing a robust (iv) Administration, Assets Management Support Services and Trusteeship Services financial services market in GIFT IFSC, IFSCA in February 2021 issued the framework for (v) Any other services as approved by IFSCA from time to time. enabling Ancillary Services at IFSC. (vi) The following entities are eligible to act as a service provider so as to provide permissible ancillary services pertaining to activities in relation to financial products, financial services The industry in GIFT IFSC is showing healthy growth having 68 entities as of March 31, 2024, and financial institutions in the IFSC: providing services across categories like Legal, Compliance and Secretarial, Professional & Management Consulting Services, Auditing, Accounting, Bookkeeping and Taxation Services, a. Any existing or newly incorporated entity set up in the IFSC. Administration, Asset Management Support Services and Trusteeship Services, etc b. Any Indian or foreign incorporated entity by establishing a branch or a subsidiary. The entity may be set up in the IFSC in the form of a company or a limited liability partnership or a registered partnership firm, branch thereof or any other form as may be approved by the IFSCA. International Financial Centres (IFCs) are regions characterized by a high concentration of Service providers can provide permissible services to any one or more of the following: financial service providers, including banks, capital market entities, insurance firms, fund managers, and FinTech companies. Additionally, these centres host professional service firms (i) Entities set up in IFSC. offering expertise in areas such as audit, accountancy, taxation, legal counsel, consulting, and (ii) Entities from foreign jurisdictions for various permissible ancillary services in IFSCs in India advisory services. The presence of professional service firms is crucial for the growth and or overseas (iii) Indian entities who propose to open, set up or carry out operations in IFSCs or foreign functionality of an international financial centre, as they support and facilitate the delivery of jurisdiction, provided consideration is received in freely convertible foreign currency. financial services by financial institutions. Globally, the expansion of financial firms and markets relies heavily on the proliferation and quality of professional service firms. Transaction/Processes/Operations/Trends Given the abundant availability of skilled professionals in India, particularly in fields such as Chartered Accountancy, Company Secretaryship, and Chartered Financial Analysis, there exists Under the Ancillary Framework, IFSCA has granted Authorisation to 68⁷² entities as on March 31, significant potential for the IFSC to emerge as a central hub for professional service providers. 2024, out of which 22 entities were granted authorization during Financial Year 2023-24. These professionals would not only serve the needs of the IFSC itself but also cater to demand from overseas markets. Recognizing the vital role of professional service providers in fostering the Table 28 : Activity-wise break up of Ancillary Services Entities development of financial markets within the GIFT IFSC, the Authority introduced the "Framework for Enabling Ancillary Services at International Financial Services Centres" in February 2021. S. No. of Authorized Entities Activity No. as on March 31, 2024 The implementation of ancillary service firms within the GIFT IFSC has greatly bolstered the 1 Legal, Compliance and Secretarial 12 growth of the financial services ecosystem by meeting the demand for professional services and 2 Professional & Management Consulting Services 21 attracting both global and domestic players to the IFSC. 3 Auditing, Accounting, Bookkeeping and Taxation Services 11 4 Administration, Asset Management Support Services 24 and Trusteeship Services Total 68 ⁷² Including in-principle approval 90 912023-24 Advocacy and Outreach Policies and Programs for the following year ICSI Office in GIFT City Review of Framework for Enabling Ancillary Services at IFSC The Institute of Company Secretaries of India (ICSI) Council approved the establishment of an A review of Circular is due after 3 years of notification. Further, with the introduction of BATF office in GIFT City, Gujarat. This move aims to narrow the skill gap and enrich the talent pool for regulations in 2024, bookkeeping, accounting, and taxation services previously included in the financial institutions in GIFT IFSC. Ancillary framework will now fall under the BATF regulations. Additionally, the revised circular is expected to address provisions related to Fit and Proper criteria, the exit of registered entities, and IFSCA MoU with ICSI modifications in the approval process. IFSCA signed an MoU with ICSI for co-operation in various initiatives including working together MoU with Professional Bodies for the development of GIFT IFSC as a Global Compliance Services Export Hub and to facilitate development of advanced corporate governance practices, compliance audit in IFSCs and promote Commence negotiations for a Memorandum of Understanding (MoU) for a Professional Outreach export of Legal, Compliance and Secretarial Services. program with distinguished professional institutes. The objective is to explore opportunities for research, capacity building, and addressing workforce skill gaps. IFSCA MoU with ICAI Addition of New Services under Ancillary Framework IFSCA signed and exchanged MoU with ICAI at Global Professional Accountants Convention for the development of GIFT IFSC as a “Global Finance and Accounting Hub” of the world. Consider including new services such as certification services, actuarial services, valuation services and Insolvency Professional services under the existing Ancillary Services Framework. Moreover, ancillary services firms have organized numerous webinars, roundtables, and conferences both globally and within India to raise awareness about opportunities in sectors such as banking, funds, insurance, aircraft leasing, and more. Box 4: Making GIFT IFSC a Global Accounting Hub Through a recent Gazette notification in January 2024, the Government of India expanded the scope of 'financial services' under the IFSCA Act 2019 to include key areas like bookkeeping, accounting, taxation, and financial crime compliance. This significant policy shift aims to position GIFT IFSC as a global hub for these services, presenting substantial employment opportunities for India's skilled workforce. Recognizing the immense potential of this policy decision, IFSCA established an Expert Committee focused on developing GIFT IFSC as a "Global Finance and Accounting Hub." The Committee has provided key suggestions and recommendations to advance bookkeeping, accounting, taxation, and financial crime compliance services. Further, IFSCA has drafted the IFSCA (Book-keeping, Accounting, Taxation, and Financial Crime Compliance Services) Regulations, 2024. These regulations outline a regulatory framework for the provision of these services within the IFSC jurisdiction. 92 932023-24 Advocacy and Outreach Policies and Programs for the following year ICSI Office in GIFT City Review of Framework for Enabling Ancillary Services at IFSC The Institute of Company Secretaries of India (ICSI) Council approved the establishment of an A review of Circular is due after 3 years of notification. Further, with the introduction of BATF office in GIFT City, Gujarat. This move aims to narrow the skill gap and enrich the talent pool for regulations in 2024, bookkeeping, accounting, and taxation services previously included in the financial institutions in GIFT IFSC. Ancillary framework will now fall under the BATF regulations. Additionally, the revised circular is expected to address provisions related to Fit and Proper criteria, the exit of registered entities, and IFSCA MoU with ICSI modifications in the approval process. IFSCA signed an MoU with ICSI for co-operation in various initiatives including working together MoU with Professional Bodies for the development of GIFT IFSC as a Global Compliance Services Export Hub and to facilitate development of advanced corporate governance practices, compliance audit in IFSCs and promote Commence negotiations for a Memorandum of Understanding (MoU) for a Professional Outreach export of Legal, Compliance and Secretarial Services. program with distinguished professional institutes. The objective is to explore opportunities for research, capacity building, and addressing workforce skill gaps. IFSCA MoU with ICAI Addition of New Services under Ancillary Framework IFSCA signed and exchanged MoU with ICAI at Global Professional Accountants Convention for the development of GIFT IFSC as a “Global Finance and Accounting Hub” of the world. Consider including new services such as certification services, actuarial services, valuation services and Insolvency Professional services under the existing Ancillary Services Framework. Moreover, ancillary services firms have organized numerous webinars, roundtables, and conferences both globally and within India to raise awareness about opportunities in sectors such as banking, funds, insurance, aircraft leasing, and more. Box 4: Making GIFT IFSC a Global Accounting Hub Through a recent Gazette notification in January 2024, the Government of India expanded the scope of 'financial services' under the IFSCA Act 2019 to include key areas like bookkeeping, accounting, taxation, and financial crime compliance. This significant policy shift aims to position GIFT IFSC as a global hub for these services, presenting substantial employment opportunities for India's skilled workforce. Recognizing the immense potential of this policy decision, IFSCA established an Expert Committee focused on developing GIFT IFSC as a "Global Finance and Accounting Hub." The Committee has provided key suggestions and recommendations to advance bookkeeping, accounting, taxation, and financial crime compliance services. Further, IFSCA has drafted the IFSCA (Book-keeping, Accounting, Taxation, and Financial Crime Compliance Services) Regulations, 2024. These regulations outline a regulatory framework for the provision of these services within the IFSC jurisdiction. 92 932023-24 FOREIGN UNIVERSITIES & INSTITUTIONS To further facilitate the setting up of IBCs and OECs in IFSC, the Ministry of Finance invoked powers under Sec 31 of IFSCA Act 2019 and disapplied University Grants Commission Act, 1956 and the All-India Council for Technical Education Act, 1987 to the courses offered by foreign universities & institutions in GIFT IFSC. The Hon’ble Union Minister of Finance and Corporate Affairs in the Union Budget 2022-23 announced, “World Class Foreign Universities and Institutions will be allowed in the GIFT City Policy/ Regulatory Developments to offer courses in Financial Management, FinTech, Science, Technology, Engineering and Mathematics, free from domestic regulations, except those by the IFSCA to facilitate During FY 2023-2024, IFSCA enabled the Academic Infrastructure Service Provider (AISP) model availability of high end human resources for financial services and technology”. for foreign universities and institutions setting up IBCs and OECs in IFSC. This regulatory enablement permitted IBCs and/or OECs to avail infrastructure services from an AISP, which shall Pursuant to the above Budget Announcement, the Ministry of Finance notified courses be registered and governed as per provisions of SEZ Act 2005. The AISP model is expected to make offered in Financial Management, FinTech, Science, Technology, Engineering and GIFT IFSC an attractive and preferred destination for foreign universities and institutions to set up Mathematics by foreign universities or foreign institutions in the IFSC as ‘Financial Services’. their overseas campuses. This policy enabler brought foreign universities and foreign educational institutions setting up campuses in IFSCs under the purview of IFSCA Act, 2019. Subsequently, IFSCA notified enabling regulations i.e. IFSCA (Setting up and operation of International Branch Campus Box 5: Key features of the AISP Circular and Offshore Education Centre) Regulation, 2022. (i) An AISP is a service provider which is providing services to an IBC/OEC, which shall include Deakin University from Australia became the 1 foreign university to be granted a Certificate providing built up campus facility, research and development facility, library, laboratories, of Registration (CoR) for their International Branch Campus in GIFT IFSC. Further, IFSCA also incubation centres, teaching classroom, and such other related services. granted in-principle approval to the University of Wollongong, a leading University from Australia. (ii) An AISP can provide the following additional services to an IBC/OEC in IFSC: a. Campus Facility Management services b. Student onboarding, Admissions and Student Welfare services c. Services for recruitment and management of non-academic staff In the Union Budget 2022-23, the Hon'ble Finance Minister announced that GIFT City will host d. Branding and Marketing services world-class foreign universities and institutions offering courses in Financial Management, e. Payroll services, etc. FinTech, STEM fields, exempt from domestic regulations but under IFSCA oversight. This initiative (iii) Eligibility Conditions for an AISP: aims to establish GIFT City as an international educational hub for both Indian and foreign students, providing high-end human resources for financial services and technology. Following a. The AISP is incorporated as a separate company in GIFT SEZ. b. The AISP shall have a minimum net worth of USD 1 Mn or equivalent for providing its this, on May 23, 2022, the Ministry of Finance designated these courses as 'Financial Services' services. under the IFSCA Act, 2019, allowing foreign educational institutions to set up campuses in the c. The AISP or any of its group company shall have at least three years of prior experience of IFSC. providing similar services to recognized universities/educational institutions in India or The overall objective of this policy announcement was to develop GIFT IFSC as an international overseas. educational centre catering to both Indian and foreign students in specified disciplines, encourage (iv) Obligations of an IBC/OEC availing services from an AISP: research in areas of Banking, Insurance, Capital Market, Funds Management, FinTech, Longevity Finance, Sustainable Finance, Quantum Computing, etc. and nurture high- end human resources in a. The IBC/ OEC shall enter into a formal written agreement with an AISP. finance, technology, and related fields. b. The agreement shall, inter-alia, contain provisions relating to indemnity, intellectual property protection, conflict of interest, financial guarantee, confidentiality and privacy, Pursuant to the above, IFSCA notified enabling regulations i.e. IFSCA (Setting up and operation of force majeure, insurance, governing law & jurisdiction, dispute resolution. International Branch Campus and Offshore Education Centre) Regulation, 2022 wherein the c. The IBC/ OEC shall provide an undertaking to IFSCA that the academic functions of the IBCs Authority specified the eligibility criteria, procedure for grant of registration, and other terms and and/or OECs, are not outsourced in any manner whatsoever, to the AISP, directly or conditions for foreign universities to set up International Branch Campuses (IBCs) and foreign indirectly. educational institutions to set up Offshore Education Centres (OEC) in IFSC. 94 952023-24 FOREIGN UNIVERSITIES & INSTITUTIONS To further facilitate the setting up of IBCs and OECs in IFSC, the Ministry of Finance invoked powers under Sec 31 of IFSCA Act 2019 and disapplied University Grants Commission Act, 1956 and the All-India Council for Technical Education Act, 1987 to the courses offered by foreign universities & institutions in GIFT IFSC. The Hon’ble Union Minister of Finance and Corporate Affairs in the Union Budget 2022-23 announced, “World Class Foreign Universities and Institutions will be allowed in the GIFT City Policy/ Regulatory Developments to offer courses in Financial Management, FinTech, Science, Technology, Engineering and Mathematics, free from domestic regulations, except those by the IFSCA to facilitate During FY 2023-2024, IFSCA enabled the Academic Infrastructure Service Provider (AISP) model availability of high end human resources for financial services and technology”. for foreign universities and institutions setting up IBCs and OECs in IFSC. This regulatory enablement permitted IBCs and/or OECs to avail infrastructure services from an AISP, which shall Pursuant to the above Budget Announcement, the Ministry of Finance notified courses be registered and governed as per provisions of SEZ Act 2005. The AISP model is expected to make offered in Financial Management, FinTech, Science, Technology, Engineering and GIFT IFSC an attractive and preferred destination for foreign universities and institutions to set up Mathematics by foreign universities or foreign institutions in the IFSC as ‘Financial Services’. their overseas campuses. This policy enabler brought foreign universities and foreign educational institutions setting up campuses in IFSCs under the purview of IFSCA Act, 2019. Subsequently, IFSCA notified enabling regulations i.e. IFSCA (Setting up and operation of International Branch Campus Box 5: Key features of the AISP Circular and Offshore Education Centre) Regulation, 2022. (i) An AISP is a service provider which is providing services to an IBC/OEC, which shall include Deakin University from Australia became the 1 foreign university to be granted a Certificate providing built up campus facility, research and development facility, library, laboratories, of Registration (CoR) for their International Branch Campus in GIFT IFSC. Further, IFSCA also incubation centres, teaching classroom, and such other related services. granted in-principle approval to the University of Wollongong, a leading University from Australia. (ii) An AISP can provide the following additional services to an IBC/OEC in IFSC: a. Campus Facility Management services b. Student onboarding, Admissions and Student Welfare services c. Services for recruitment and management of non-academic staff In the Union Budget 2022-23, the Hon'ble Finance Minister announced that GIFT City will host d. Branding and Marketing services world-class foreign universities and institutions offering courses in Financial Management, e. Payroll services, etc. FinTech, STEM fields, exempt from domestic regulations but under IFSCA oversight. This initiative (iii) Eligibility Conditions for an AISP: aims to establish GIFT City as an international educational hub for both Indian and foreign students, providing high-end human resources for financial services and technology. Following a. The AISP is incorporated as a separate company in GIFT SEZ. b. The AISP shall have a minimum net worth of USD 1 Mn or equivalent for providing its this, on May 23, 2022, the Ministry of Finance designated these courses as 'Financial Services' services. under the IFSCA Act, 2019, allowing foreign educational institutions to set up campuses in the c. The AISP or any of its group company shall have at least three years of prior experience of IFSC. providing similar services to recognized universities/educational institutions in India or The overall objective of this policy announcement was to develop GIFT IFSC as an international overseas. educational centre catering to both Indian and foreign students in specified disciplines, encourage (iv) Obligations of an IBC/OEC availing services from an AISP: research in areas of Banking, Insurance, Capital Market, Funds Management, FinTech, Longevity Finance, Sustainable Finance, Quantum Computing, etc. and nurture high- end human resources in a. The IBC/ OEC shall enter into a formal written agreement with an AISP. finance, technology, and related fields. b. The agreement shall, inter-alia, contain provisions relating to indemnity, intellectual property protection, conflict of interest, financial guarantee, confidentiality and privacy, Pursuant to the above, IFSCA notified enabling regulations i.e. IFSCA (Setting up and operation of force majeure, insurance, governing law & jurisdiction, dispute resolution. International Branch Campus and Offshore Education Centre) Regulation, 2022 wherein the c. The IBC/ OEC shall provide an undertaking to IFSCA that the academic functions of the IBCs Authority specified the eligibility criteria, procedure for grant of registration, and other terms and and/or OECs, are not outsourced in any manner whatsoever, to the AISP, directly or conditions for foreign universities to set up International Branch Campuses (IBCs) and foreign indirectly. educational institutions to set up Offshore Education Centres (OEC) in IFSC. 94 952023-24 Transaction/Processes/Operations/Trends During FY 2023-24, IFSCA achieved a significant milestone by granting final certificate of registration to Deakin University, Australia, for their International Branch Campus in GIFT IFSC under IFSCA (Setting up and operation of International Branch Campus and Offshore Education Centre) Regulation, 2022. Deakin University with a QS World University Ranking of 233 in 2024 became the first foreign university to be approved under this policy initiative of Government of India. Deakin University IBC has set up a state of art campus facility in GIFT IFSC and is expected to begin its academic operations from July 2024 with two master's courses namely Master of Cyber Security and Master of Business Analytics. Image 25 : Deakin University in GIFT IFSC In May 2023, University of Wollongong (UoW) from Australia became the 2ⁿ foreign university to apply and receive in-principle approval from IFSCA for setting up their International Branch Campus in GIFT IFSC. UoW is a leading Australian public university located in the coastal city of Wollongong, New South Wales and has secured a rank of 162 in QS World University Rankings 2024. UoW IBC is expected to begin their academic operations from July 2024 with the introduction of Master of Computing (Data Analytics), after obtaining final certificate of registration from IFSCA. Advocacy and Outreach During FY 2023-24, IFSCA held several roundtable interactions and bilateral meetings with leading universities from USA, Australia, France and United Kingdom. Several foreign universities were actively exploring the opportunity to set up their IBC in GIFT IFSC and thereby expand their presence in India. 962023-24 Transaction/Processes/Operations/Trends During FY 2023-24, IFSCA achieved a significant milestone by granting final certificate of registration to Deakin University, Australia, for their International Branch Campus in GIFT IFSC under IFSCA (Setting up and operation of International Branch Campus and Offshore Education Centre) Regulation, 2022. Deakin University with a QS World University Ranking of 233 in 2024 became the first foreign university to be approved under this policy initiative of Government of India. Deakin University IBC has set up a state of art campus facility in GIFT IFSC and is expected to begin its academic operations from July 2024 with two master's courses namely Master of Cyber Security and Master of Business Analytics. Image 25 : Deakin University in GIFT IFSC In May 2023, University of Wollongong (UoW) from Australia became the 2ⁿ foreign university to apply and receive in-principle approval from IFSCA for setting up their International Branch Campus in GIFT IFSC. UoW is a leading Australian public university located in the coastal city of Wollongong, New South Wales and has secured a rank of 162 in QS World University Rankings 2024. UoW IBC is expected to begin their academic operations from July 2024 with the introduction of Master of Computing (Data Analytics), after obtaining final certificate of registration from IFSCA. Advocacy and Outreach During FY 2023-24, IFSCA held several roundtable interactions and bilateral meetings with leading universities from USA, Australia, France and United Kingdom. Several foreign universities were actively exploring the opportunity to set up their IBC in GIFT IFSC and thereby expand their presence in India. 962023-24 INFORMATION TECHNOLOGY Figure 18 : Schematic Representation of SWIT System The spheres of technology and finance have increasingly become intertwined, as latest SEZ Approvals technological innovations provide improved security, speed, convenience, coverage, and 'Ease of Doing Business' in the field of finance. The use of Technology has become indispensable for a regulator with its increasing impact on regulation, supervision, and governance in the international financial regulatory ecosystem. IFSCA lays emphasis on using technology as the key to increase the transparency and efficiency of operations, and in improving the ease of doing business for Regulated Entities in IFSCs. IFSCA GSTIN SWITS Approvals Generation Towards this end, IFSCA has undertaken several initiatives in the Financial Year (FY) 2023-24: IFSCA's Supervisory Technology (SupTech) System NoCs from other Financial IFSCA is in the process of appointing a suitable SupTech Solution Provider to implement the Sector Regulators (RBI, SEBI, IRDAI) system to facilitate the supervisory functioning of the Authority. The envisioned system aims to establish a comprehensive framework for administration, compliance, supervision, and enforcement amongst its regulated entities. The primary focus is to incorporate advanced technology and adhere to global best practices to achieve the Authority's objectives effectively. Revamp of IFSCA Website and Legal Database Box 6 : IFSCA Single Window IT System (SWITS) The Hon'ble Finance Minister, in the Union Budget for FY 2023-24 announced In line with the IFSCA (Maintenance of Website) Regulations, 2022 IFSCA has initiated the “Implementation of a single window IT-enabled system for application processing of entities development of a best-in-class website, benchmarked with other international financial sector desirous of setting up operations in GIFT IFSC” to improve the Ease of Doing Business (EoDB). regulators, while conforming to the standards and guidelines of Government of India and other relevant agencies. (i) Towards this end, IFSCA floated a Request for Proposal (RFP) on GeM (Government e- Marketplace) and finalized a vendor for implementing the SWITS. The IFSCA website acts as an important interface with the public as well as the regulated entities (ii) A Common Application Form (CAF), that was developed by IFSCA by merging several and other stakeholders to disseminate information through its regulations, circulars, existing forms, was digitally translated in the SWITS. This CAF along with the vertical- notifications, etc. specific Annexure forms aim to harmonize and simplify the process of Registration in The updated IFSCA website shall host the IFSCA SWITS and cater to the needs of Regulated Entities IFSCs. (REs), prospective businesses and foreign financial regulators, improving their Ease of Doing (iii) The CAF also comprises of the details required for an entity's SEZ Approval, which is Business with IFSCA. designed to be sent to the SEZ Online System automatically by means of an API The revamped website shall contain a directory that would be linked to SWITS for real-time integration. This integration was completed by jointly working with NSDL. updating of data. A Legal Database Module would also be housed on the revamped website (iv) Apart from this, the SWITS also integrates within itself an NoC processing module through enabling easy access and searchability of relevant regulations, circulars and legal information. API integration. The APIs were developed and tested with the involvement and support of the other financial sector regulators, RBI, SEBI and IRDAI. Enterprise Resource Planning (ERP) System (v) SWITS also integrates the process of applying for GSTIN for an IFSC entity, which is being The ERP system of IFSCA is aimed at easing the general administration through digitizing done in coordination with GSTN. employees' attendance management, leave management, and pay slip generation. This system will (vi) Real time data validation of PAN, DIN and CIN would also be done through APIs that are be used for processing the claims of all the employees in a paperless manner. Further, the objective incorporated into SWITS. is to scale the system to include all other general administrative functions within its ambit. 98 992023-24 INFORMATION TECHNOLOGY Figure 18 : Schematic Representation of SWIT System The spheres of technology and finance have increasingly become intertwined, as latest SEZ Approvals technological innovations provide improved security, speed, convenience, coverage, and 'Ease of Doing Business' in the field of finance. The use of Technology has become indispensable for a regulator with its increasing impact on regulation, supervision, and governance in the international financial regulatory ecosystem. IFSCA lays emphasis on using technology as the key to increase the transparency and efficiency of operations, and in improving the ease of doing business for Regulated Entities in IFSCs. IFSCA GSTIN SWITS Approvals Generation Towards this end, IFSCA has undertaken several initiatives in the Financial Year (FY) 2023-24: IFSCA's Supervisory Technology (SupTech) System NoCs from other Financial IFSCA is in the process of appointing a suitable SupTech Solution Provider to implement the Sector Regulators (RBI, SEBI, IRDAI) system to facilitate the supervisory functioning of the Authority. The envisioned system aims to establish a comprehensive framework for administration, compliance, supervision, and enforcement amongst its regulated entities. The primary focus is to incorporate advanced technology and adhere to global best practices to achieve the Authority's objectives effectively. Revamp of IFSCA Website and Legal Database Box 6 : IFSCA Single Window IT System (SWITS) The Hon'ble Finance Minister, in the Union Budget for FY 2023-24 announced In line with the IFSCA (Maintenance of Website) Regulations, 2022 IFSCA has initiated the “Implementation of a single window IT-enabled system for application processing of entities development of a best-in-class website, benchmarked with other international financial sector desirous of setting up operations in GIFT IFSC” to improve the Ease of Doing Business (EoDB). regulators, while conforming to the standards and guidelines of Government of India and other relevant agencies. (i) Towards this end, IFSCA floated a Request for Proposal (RFP) on GeM (Government e- Marketplace) and finalized a vendor for implementing the SWITS. The IFSCA website acts as an important interface with the public as well as the regulated entities (ii) A Common Application Form (CAF), that was developed by IFSCA by merging several and other stakeholders to disseminate information through its regulations, circulars, existing forms, was digitally translated in the SWITS. This CAF along with the vertical- notifications, etc. specific Annexure forms aim to harmonize and simplify the process of Registration in The updated IFSCA website shall host the IFSCA SWITS and cater to the needs of Regulated Entities IFSCs. (REs), prospective businesses and foreign financial regulators, improving their Ease of Doing (iii) The CAF also comprises of the details required for an entity's SEZ Approval, which is Business with IFSCA. designed to be sent to the SEZ Online System automatically by means of an API The revamped website shall contain a directory that would be linked to SWITS for real-time integration. This integration was completed by jointly working with NSDL. updating of data. A Legal Database Module would also be housed on the revamped website (iv) Apart from this, the SWITS also integrates within itself an NoC processing module through enabling easy access and searchability of relevant regulations, circulars and legal information. API integration. The APIs were developed and tested with the involvement and support of the other financial sector regulators, RBI, SEBI and IRDAI. Enterprise Resource Planning (ERP) System (v) SWITS also integrates the process of applying for GSTIN for an IFSC entity, which is being The ERP system of IFSCA is aimed at easing the general administration through digitizing done in coordination with GSTN. employees' attendance management, leave management, and pay slip generation. This system will (vi) Real time data validation of PAN, DIN and CIN would also be done through APIs that are be used for processing the claims of all the employees in a paperless manner. Further, the objective incorporated into SWITS. is to scale the system to include all other general administrative functions within its ambit. 98 992023-24 eOffice-IFSCA application NSCS, DoT, MeitY, and leading academic institutions, to further strengthen the cyber security and resilience of GIFT IFSC. eOffice-IFSCA application, developed by National Informatics Centre (NIC), is IFSCA's electronic IFSCA's MoU with C3i Hub, IIT Kanpur file management system, and supports governance, e-File, an integral part of e-office suite is a system designed for the Government departments, PSUs, and statutory bodies to enable a IFSCA signed an MoU with IHUB NTIHC FOUNDATION C3i Hub on March 15, 2024, at IIT Kanpur paperless office. for collaboration in Cyber Security. IFSCA and C3iHub intend to facilitate cooperation and mutual assistance in the areas of cyber security and cyber resilience, inter alia, including Threat The eOffice application helps with easy movement and tracking of files as well as receipts. The Intelligence Systems, Cybersecurity Audits and Assessments, Capacity Building and Training application also includes file management system, knowledge management system, Management Initiatives and other areas related to cyber security. Information Systems (MIS), employee data management and master data management which helps in digitizing IFSCA's internal processes. C3i Hub deals in the domain of Cyber Security, generation of new knowledge through basic and applied research, developing tools and providing services for enhancing cybersecurity. The IT Infrastructure Company is formed under Mission NM ICPS, Ministry of Science & Technology to host Technology Innovation Hub (“TIH”) in cybersecurity. IFSCA provides workstations equipped with computers, printers, telephones, and high-speed Local Area Network (LAN) connectivity to its employees. IFSCA has operationalized an internal mail server for ease of document sharing within the organization, while ensuring data security. IFSCA Headquarters has high-speed Wi-Fi connectivity, and the meeting rooms are equipped with world-class video conferencing devices for seamless communication. Social Media The IFSCA has taken proactive steps to improve its social media presence. The efforts taken in timely posting and appropriate tagging has led to an increase in social media footprint of IFSCA and has improved the coverage and timeliness of information dissemination from IFSCA. Together, the website and social media are being leveraged to secure India's place in the digital arena in the company of other major international financial sector regulators of the world. Cyber Security Cyber Security Advisory Committee On May 12, 2023, the Hon'ble Prime Minister of India graced GIFT IFSC with a visit. A primary outcome of this visit was the emphasis on the creation of a forward-looking cyber security vision document for GIFT IFSC. As a step towards that direction, IFSCA has formed a Cyber Security Advisory Committee (CSAC) chaired by Dr. Sanjay Bahl, Director General, CERT-In on August 17, 2023. The Committee's terms of reference encompass preparing a cyber security vision document for GIFT IFSC and overseeing and guiding cyber security initiatives for GIFT IFSC. The Committee shall advise IFSCA on developing and maintaining cyber security and cyber resilience requirements for the Regulated Entities (REs) aligned with global best practices. Additionally, the Committee will recommend improvements for cyber security audit processes, review the mandate and functioning of Security Operation Centers (SOCs), and guide the setup of a Cyber Lab/ Cyber Center of Excellence. It will also study major global cyber-attack incidents to identify gaps in the current cyber security framework and engage in continuous dialogues with relevant external agencies, such as CERT-In, 100 1012023-24 eOffice-IFSCA application NSCS, DoT, MeitY, and leading academic institutions, to further strengthen the cyber security and resilience of GIFT IFSC. eOffice-IFSCA application, developed by National Informatics Centre (NIC), is IFSCA's electronic IFSCA's MoU with C3i Hub, IIT Kanpur file management system, and supports governance, e-File, an integral part of e-office suite is a system designed for the Government departments, PSUs, and statutory bodies to enable a IFSCA signed an MoU with IHUB NTIHC FOUNDATION C3i Hub on March 15, 2024, at IIT Kanpur paperless office. for collaboration in Cyber Security. IFSCA and C3iHub intend to facilitate cooperation and mutual assistance in the areas of cyber security and cyber resilience, inter alia, including Threat The eOffice application helps with easy movement and tracking of files as well as receipts. The Intelligence Systems, Cybersecurity Audits and Assessments, Capacity Building and Training application also includes file management system, knowledge management system, Management Initiatives and other areas related to cyber security. Information Systems (MIS), employee data management and master data management which helps in digitizing IFSCA's internal processes. C3i Hub deals in the domain of Cyber Security, generation of new knowledge through basic and applied research, developing tools and providing services for enhancing cybersecurity. The IT Infrastructure Company is formed under Mission NM ICPS, Ministry of Science & Technology to host Technology Innovation Hub (“TIH”) in cybersecurity. IFSCA provides workstations equipped with computers, printers, telephones, and high-speed Local Area Network (LAN) connectivity to its employees. IFSCA has operationalized an internal mail server for ease of document sharing within the organization, while ensuring data security. IFSCA Headquarters has high-speed Wi-Fi connectivity, and the meeting rooms are equipped with world-class video conferencing devices for seamless communication. Social Media The IFSCA has taken proactive steps to improve its social media presence. The efforts taken in timely posting and appropriate tagging has led to an increase in social media footprint of IFSCA and has improved the coverage and timeliness of information dissemination from IFSCA. Together, the website and social media are being leveraged to secure India's place in the digital arena in the company of other major international financial sector regulators of the world. Cyber Security Cyber Security Advisory Committee On May 12, 2023, the Hon'ble Prime Minister of India graced GIFT IFSC with a visit. A primary outcome of this visit was the emphasis on the creation of a forward-looking cyber security vision document for GIFT IFSC. As a step towards that direction, IFSCA has formed a Cyber Security Advisory Committee (CSAC) chaired by Dr. Sanjay Bahl, Director General, CERT-In on August 17, 2023. The Committee's terms of reference encompass preparing a cyber security vision document for GIFT IFSC and overseeing and guiding cyber security initiatives for GIFT IFSC. The Committee shall advise IFSCA on developing and maintaining cyber security and cyber resilience requirements for the Regulated Entities (REs) aligned with global best practices. Additionally, the Committee will recommend improvements for cyber security audit processes, review the mandate and functioning of Security Operation Centers (SOCs), and guide the setup of a Cyber Lab/ Cyber Center of Excellence. It will also study major global cyber-attack incidents to identify gaps in the current cyber security framework and engage in continuous dialogues with relevant external agencies, such as CERT-In, 100 1012023-24 DEVELOPMENTAL ACTIVITIES The MoU will also enhance engagement between IFSCA and overseas chapters of ICAI, enabling better dissemination of information on the regulatory landscape and export opportunities for financial services from GIFT IFSC Policy/ Regulatory Developments Consultation paper on BATF On March 26, 2024, IFSCA released a Consultation Paper on Draft IFSCA (Book-keeping, Accounting, Taxation and Financial Crime Compliance Services) Regulations, 2024 with a objective of seeking suggestions and comments from the public. The draft regulations aim to put in place the regulatory framework relating to registration and operations of Book-keeping, Accounting, Taxation and Financial Crime Compliance Services (BATF) from International Financial Services Centres. The consultation paper was issued pursuant to Government of India's notification dated January 18, 2024, wherein bookkeeping, accounting, taxation and financial crime compliance services were notified as 'financial services' under section 3 of IFSCA Act 2019. International and Domestic MoUs IFSCA signs an MoU with Financial Services Commission, Mauritius On March 13, 2024, IFSCA and Financial Services Commission, Mauritius (FSC Mauritius) formally exchanged the MoU to formalize institutional cooperation between the two regulators. The MoU exchange ceremony was held in Mauritius in the august presence of Hon'ble Shri Pravind Kumar Jugnauth, the Hon'ble Prime Minister of the Republic of Mauritius and Smt. Droupadi Murmu, the Hon'ble President of the Republic of India. The Inter-regulatory Cooperation MoU aims to facilitate the exchange of knowledge and best practices in the development, regulation, and supervision of the financial markets within the Image 26 : Exchange of MoU-ICAI with IFSCA and GIFT City respective jurisdictions. Additionally, it seeks to ensure the fitness and propriety of licensed or registered individuals and to promote high standards and integrity in business conduct. IFSCA signs an MoU with the Institute of Company Secretaries of India (ICSI) In addition, the MoU also aims to facilitate the enforcement of laws, rules, and regulations On December 10, 2023, IFSCA signed and exchanged a Memorandum of Understanding (MoU) governing financial products, financial services, and financial institutions within the respective with the ICSI during IFSCA's annual flagship event “Infinity Forum 2.0” held in GIFT City, jurisdictions. Gandhinagar. The MoU seeks to strengthen the collaboration between the two organizations for facilitating the development of GIFT IFSC as a “Global Compliance Services export Hub” and to IFSCA signs an MoU with the Institute of Chartered Accountants of India facilitate development of advanced corporate governance practices, compliance audit in IFSC and On November 25, 2023, IFSCA signed and exchanged a Memorandum of Understanding (MoU) promote the export of legal, compliance and secretarial services. with the Institute of Chartered Accountants of India (ICAI) at the Global Professional Accountants IFSCA signs an MoU with Institute of Actuaries of India (IAI) Convention held in Gandhinagar, Gujarat. The MoU aims to deepen the bilateral cooperation On December 09, 2023, IFSCA signed a (MoU) with the Institute of Actuaries of India (IAI) during between the two authorities for promotion and development of GIFT IFSC as a “Global Financial IFSCA's flagship event “Infinity Forum 2.0” held in GIFT City, Gandhinagar. The MoU aims to deepen and Accounting Hub”. the cooperation between IFSCA and IAI for promoting and developing GIFT IFSC as a “Global Actuarial Hub” and promote the export of actuarial services from GIFT IFSC. The MoU also seeks to facilitate greater cooperation for promotion and development of financial markets in GIFT IFSC. 102 1032023-24 DEVELOPMENTAL ACTIVITIES The MoU will also enhance engagement between IFSCA and overseas chapters of ICAI, enabling better dissemination of information on the regulatory landscape and export opportunities for financial services from GIFT IFSC Policy/ Regulatory Developments Consultation paper on BATF On March 26, 2024, IFSCA released a Consultation Paper on Draft IFSCA (Book-keeping, Accounting, Taxation and Financial Crime Compliance Services) Regulations, 2024 with a objective of seeking suggestions and comments from the public. The draft regulations aim to put in place the regulatory framework relating to registration and operations of Book-keeping, Accounting, Taxation and Financial Crime Compliance Services (BATF) from International Financial Services Centres. The consultation paper was issued pursuant to Government of India's notification dated January 18, 2024, wherein bookkeeping, accounting, taxation and financial crime compliance services were notified as 'financial services' under section 3 of IFSCA Act 2019. International and Domestic MoUs IFSCA signs an MoU with Financial Services Commission, Mauritius On March 13, 2024, IFSCA and Financial Services Commission, Mauritius (FSC Mauritius) formally exchanged the MoU to formalize institutional cooperation between the two regulators. The MoU exchange ceremony was held in Mauritius in the august presence of Hon'ble Shri Pravind Kumar Jugnauth, the Hon'ble Prime Minister of the Republic of Mauritius and Smt. Droupadi Murmu, the Hon'ble President of the Republic of India. The Inter-regulatory Cooperation MoU aims to facilitate the exchange of knowledge and best practices in the development, regulation, and supervision of the financial markets within the Image 26 : Exchange of MoU-ICAI with IFSCA and GIFT City respective jurisdictions. Additionally, it seeks to ensure the fitness and propriety of licensed or registered individuals and to promote high standards and integrity in business conduct. IFSCA signs an MoU with the Institute of Company Secretaries of India (ICSI) In addition, the MoU also aims to facilitate the enforcement of laws, rules, and regulations On December 10, 2023, IFSCA signed and exchanged a Memorandum of Understanding (MoU) governing financial products, financial services, and financial institutions within the respective with the ICSI during IFSCA's annual flagship event “Infinity Forum 2.0” held in GIFT City, jurisdictions. Gandhinagar. The MoU seeks to strengthen the collaboration between the two organizations for facilitating the development of GIFT IFSC as a “Global Compliance Services export Hub” and to IFSCA signs an MoU with the Institute of Chartered Accountants of India facilitate development of advanced corporate governance practices, compliance audit in IFSC and On November 25, 2023, IFSCA signed and exchanged a Memorandum of Understanding (MoU) promote the export of legal, compliance and secretarial services. with the Institute of Chartered Accountants of India (ICAI) at the Global Professional Accountants IFSCA signs an MoU with Institute of Actuaries of India (IAI) Convention held in Gandhinagar, Gujarat. The MoU aims to deepen the bilateral cooperation On December 09, 2023, IFSCA signed a (MoU) with the Institute of Actuaries of India (IAI) during between the two authorities for promotion and development of GIFT IFSC as a “Global Financial IFSCA's flagship event “Infinity Forum 2.0” held in GIFT City, Gandhinagar. The MoU aims to deepen and Accounting Hub”. the cooperation between IFSCA and IAI for promoting and developing GIFT IFSC as a “Global Actuarial Hub” and promote the export of actuarial services from GIFT IFSC. The MoU also seeks to facilitate greater cooperation for promotion and development of financial markets in GIFT IFSC. 102 1032023-24 Working Groups/Committees Report of Working Group on “Development of Non-Resident Individual Business and Ease of Registration” submitted to IFSCA Report of Expert Committee on developing GIFT IFSC as a “Global Finance and IFSCA constituted a Working Group on “Development of Non-Resident Individual (NRI) Business Accounting Hub” submitted to IFSCA and Ease of Registration” on October 06, 2023. The Working Group comprised of industry experts having domain knowledge in areas such as capital market, asset management, banking, insurance, Pursuant to Government of India's notification dated January 18, 2024, notifying book-keeping, law, FinTech, etc. The Working Group submitted its report to the IFSCA on May 09, 2024. The accounting, taxation and financial crime compliance services as 'Financial Services' under Sec report envisions harnessing the full potential of GIFT IFSC to attract NR and NRI investments, 3(1)(e)(xiv) of IFSCA Act, 2019, IFSCA constituted an Expert Committee on developing GIFT IFSC especially those wanting to invest in or from their home countries. as a “Global Finance and Accounting Hub” under the Chairmanship of Shri Ranjeet Agrawal, The Working Group highlighted the importance of NRI investments into India through GIFT IFSC President, ICAI. The Expert Committee comprised of leading experts from the financial services and conducted a comprehensive global benchmarking exercise of GIFT IFSC with leading industry, academia and the Government. The Expert Committee submitted its report to the IFSCA International Financial Centres, including New York, London, Luxembourg, Dubai, and Singapore. on March 26, 2024. The report examined the onboarding process for NRIs, which covered various aspects such as customer identification, authentication and execution of documents. The report aims to provide a strategic roadmap for the development of NRI business in GIFT IFSC, emphasizing ease of onboarding and positioning GIFT IFSC as a global financial hub. Report of Expert Committee on “Onshoring the Indian Innovation to GIFT IFSC” submitted to IFSCA On August 14, 2024, the Expert Committee constituted by IFSCA on “Onshoring the Indian Innovation to GIFT IFSC” under the chairmanship of Shri G Padmanabhan, Former Executive Director, RBI submitted its report to Chairperson, IFSCA. The committee members comprised of experts having domain knowledge in areas such as Venture Capital, Startups, FinTech, Law, Taxation and other domain experts. The report examined various facets related to flipping of Indian start-ups and Indian innovation to overseas jurisdictions and recommended various measures to facilitate reverse flipping of Indian startups to GIFT IFSC. The committee in its report also identified challenges and provided recommendations for development of GIFT IFSC as International Innovation Hub. The Committee identified various measures/ action points that are required to be implemented by relevant stakeholders including Ministries, Regulatory Authorities and others for onshoring Indian innovation to GIFT IFSC. Advocacy and Outreach Image 27 : Submission of Report to Chairperson, IFSCA by Expert Committee on BATF Public Sector Enterprises @ 2047: GIFT IFSC Opportunities The Expert Committee provided recommendations to the IFSCA on developing a comprehensive regulatory regime for providing bookkeeping, accounting, taxation and financial crimes The 1 edition of IFSCA's annual summit on Public Sector Enterprises @ 2047: GIFT IFSC compliance services from GIFT IFSC. Additionally, the Committee has provided recommendations opportunities was held on February 23, 2024, in GIFT City. The Summit was inaugurated by Shri K. for the promotion and development of GIFT IFSC as “Global Finance and Accounting Hub” Rajaraman, Chairperson, IFSCA in the presence of Shri Amardeep Singh Chowdhary, Principal including measures for enhancing the skills and competencies of the workforce. Advisor, Department of Public Enterprises, Government of India, Managing Directors and CMDs of leading Central and State Public Sector Enterprises (PSEs). Senior leadership from 50+ PSEs and representatives from the financial markets including Banks, Insurance Companies, Stock Exchanges, etc. also attended the conference. 104 1052023-24 Working Groups/Committees Report of Working Group on “Development of Non-Resident Individual Business and Ease of Registration” submitted to IFSCA Report of Expert Committee on developing GIFT IFSC as a “Global Finance and IFSCA constituted a Working Group on “Development of Non-Resident Individual (NRI) Business Accounting Hub” submitted to IFSCA and Ease of Registration” on October 06, 2023. The Working Group comprised of industry experts having domain knowledge in areas such as capital market, asset management, banking, insurance, Pursuant to Government of India's notification dated January 18, 2024, notifying book-keeping, law, FinTech, etc. The Working Group submitted its report to the IFSCA on May 09, 2024. The accounting, taxation and financial crime compliance services as 'Financial Services' under Sec report envisions harnessing the full potential of GIFT IFSC to attract NR and NRI investments, 3(1)(e)(xiv) of IFSCA Act, 2019, IFSCA constituted an Expert Committee on developing GIFT IFSC especially those wanting to invest in or from their home countries. as a “Global Finance and Accounting Hub” under the Chairmanship of Shri Ranjeet Agrawal, The Working Group highlighted the importance of NRI investments into India through GIFT IFSC President, ICAI. The Expert Committee comprised of leading experts from the financial services and conducted a comprehensive global benchmarking exercise of GIFT IFSC with leading industry, academia and the Government. The Expert Committee submitted its report to the IFSCA International Financial Centres, including New York, London, Luxembourg, Dubai, and Singapore. on March 26, 2024. The report examined the onboarding process for NRIs, which covered various aspects such as customer identification, authentication and execution of documents. The report aims to provide a strategic roadmap for the development of NRI business in GIFT IFSC, emphasizing ease of onboarding and positioning GIFT IFSC as a global financial hub. Report of Expert Committee on “Onshoring the Indian Innovation to GIFT IFSC” submitted to IFSCA On August 14, 2024, the Expert Committee constituted by IFSCA on “Onshoring the Indian Innovation to GIFT IFSC” under the chairmanship of Shri G Padmanabhan, Former Executive Director, RBI submitted its report to Chairperson, IFSCA. The committee members comprised of experts having domain knowledge in areas such as Venture Capital, Startups, FinTech, Law, Taxation and other domain experts. The report examined various facets related to flipping of Indian start-ups and Indian innovation to overseas jurisdictions and recommended various measures to facilitate reverse flipping of Indian startups to GIFT IFSC. The committee in its report also identified challenges and provided recommendations for development of GIFT IFSC as International Innovation Hub. The Committee identified various measures/ action points that are required to be implemented by relevant stakeholders including Ministries, Regulatory Authorities and others for onshoring Indian innovation to GIFT IFSC. Advocacy and Outreach Image 27 : Submission of Report to Chairperson, IFSCA by Expert Committee on BATF Public Sector Enterprises @ 2047: GIFT IFSC Opportunities The Expert Committee provided recommendations to the IFSCA on developing a comprehensive regulatory regime for providing bookkeeping, accounting, taxation and financial crimes The 1 edition of IFSCA's annual summit on Public Sector Enterprises @ 2047: GIFT IFSC compliance services from GIFT IFSC. Additionally, the Committee has provided recommendations opportunities was held on February 23, 2024, in GIFT City. The Summit was inaugurated by Shri K. for the promotion and development of GIFT IFSC as “Global Finance and Accounting Hub” Rajaraman, Chairperson, IFSCA in the presence of Shri Amardeep Singh Chowdhary, Principal including measures for enhancing the skills and competencies of the workforce. Advisor, Department of Public Enterprises, Government of India, Managing Directors and CMDs of leading Central and State Public Sector Enterprises (PSEs). Senior leadership from 50+ PSEs and representatives from the financial markets including Banks, Insurance Companies, Stock Exchanges, etc. also attended the conference. 104 1052023-24 Image 29 : Hon’ble Union Minister of Finance and Corporate Affairs Smt. Nirmala Sitharaman visited IFSCA Head Office Image 28 : Shri Pradeep Ramakrishnan, ED, IFSCA with dignitaries at the PSE@2047 Visit to Grand Duchy of Luxembourg, Belgium, and France The IFSCA delegation led by the Chairperson, IFSCA visited Grand Duchy of Luxembourg, Belgium During the Summit, MDs and senior executives from leading PSEs such as ONGC Videsh Ltd., Power and France in February 2024 to engage with the financial sector regulators and the financial Finance Corporation Ltd. and Indian Oil Corporation Ltd. shared their experiences of setting up industry players. During the visit, IFSCA officials interacted with Association of the Luxembourg business operations in GIFT IFSC for undertaking international financial services businesses, Fund Industry (ALFI), Luxembourg Private Equity and Venture Capital Association (LPEA), including Global Treasury Centre operations, foreign currency borrowing, holding company Luxembourg House of Financial Technology (LHoFT), Luxembourg Stock Exchange, Luxembourg structure, etc. Leaders from the financial sector discussed and presented various opportunities for Financial Sector Supervisory Commission (CSSF), European Investment Bank (EIB) Financial PSEs in GIFT IFSC including Global Treasury Centre operations, ship acquisition financing and Services and Markets Authority, Belgium, Financial Stability, Financial Services and Capital leasing, aircraft leasing, holding company structures, debt listing, insurance business, etc. Markets Union, etc. Visit of Hon'ble Union Minister of Finance and Corporate Affairs, Smt. Nirmala Sitharaman to IFSCA On August 19, 2023, the Hon'ble Union Minister of Finance and Corporate Affairs Smt. Nirmala Sitharaman visited IFSCA Head Office in GIFT City to review the developments in India's maidan IFSC in GIFT City, Gujarat. Shri K. Rajaraman, Chairperson, IFSCA apprised Hon'ble FM about the regulatory and development initiatives launched by IFSCA, and also highlighted the measures being taken for reducing the cost of doing business in GIFT IFSC. The Hon'ble FM was also briefed about the immediate and future priority areas for IFSCA. Image 30 : IFSCA delegation led by Shri K Rajaraman, Chairperson, IFSCA met Mr Jerome Reboul, Deputy Secretary General and Managing Director of Dept. of International Affairs, AMF France at their headquarters 106 1072023-24 Image 29 : Hon’ble Union Minister of Finance and Corporate Affairs Smt. Nirmala Sitharaman visited IFSCA Head Office Image 28 : Shri Pradeep Ramakrishnan, ED, IFSCA with dignitaries at the PSE@2047 Visit to Grand Duchy of Luxembourg, Belgium, and France The IFSCA delegation led by the Chairperson, IFSCA visited Grand Duchy of Luxembourg, Belgium During the Summit, MDs and senior executives from leading PSEs such as ONGC Videsh Ltd., Power and France in February 2024 to engage with the financial sector regulators and the financial Finance Corporation Ltd. and Indian Oil Corporation Ltd. shared their experiences of setting up industry players. During the visit, IFSCA officials interacted with Association of the Luxembourg business operations in GIFT IFSC for undertaking international financial services businesses, Fund Industry (ALFI), Luxembourg Private Equity and Venture Capital Association (LPEA), including Global Treasury Centre operations, foreign currency borrowing, holding company Luxembourg House of Financial Technology (LHoFT), Luxembourg Stock Exchange, Luxembourg structure, etc. Leaders from the financial sector discussed and presented various opportunities for Financial Sector Supervisory Commission (CSSF), European Investment Bank (EIB) Financial PSEs in GIFT IFSC including Global Treasury Centre operations, ship acquisition financing and Services and Markets Authority, Belgium, Financial Stability, Financial Services and Capital leasing, aircraft leasing, holding company structures, debt listing, insurance business, etc. Markets Union, etc. Visit of Hon'ble Union Minister of Finance and Corporate Affairs, Smt. Nirmala Sitharaman to IFSCA On August 19, 2023, the Hon'ble Union Minister of Finance and Corporate Affairs Smt. Nirmala Sitharaman visited IFSCA Head Office in GIFT City to review the developments in India's maidan IFSC in GIFT City, Gujarat. Shri K. Rajaraman, Chairperson, IFSCA apprised Hon'ble FM about the regulatory and development initiatives launched by IFSCA, and also highlighted the measures being taken for reducing the cost of doing business in GIFT IFSC. The Hon'ble FM was also briefed about the immediate and future priority areas for IFSCA. Image 30 : IFSCA delegation led by Shri K Rajaraman, Chairperson, IFSCA met Mr Jerome Reboul, Deputy Secretary General and Managing Director of Dept. of International Affairs, AMF France at their headquarters 106 1072023-24 Image 32 : Plenary Session “GIFT City – An Aspiration of Modern India” in Vibrant Gujarat 2024“ (Left to Right) Shri K. Rajaraman, Chairperson, IFSCA;Shri Kanubhai Desai, Finance Minister, Government of Gujarat; Hon'ble Finance Minister, Smt. Nirmala Sitharaman; Shri Hasmukh Adhia, Chairman, GIFT City and Shri Image 31 : Chairperson, IFSCA addressing the officials of Luxembourg Stock Exchange (LSE) Tapan Ray, MD & CEO, GIFT City Visit to Japan Vibrant Gujarat Global Summit 2024 An IFSCA delegation led by Chairperson, IFSCA visited Japan from November 2023 to engage and The 10 edition of Vibrant Gujarat Global Summit 2024 was held between January 10-12 in interact with Japanese financial market institutions and to participate in the IAIS Annual General Gandhinagar, Gujarat. The Hon'ble Prime Minister inaugurated the Summit and presided over the Meeting and Annual Conference. During the visit, IFSCA officials interacted with major market Global FinTech Leadership Forum (GFLF) at GIFT City. The forum was attended by leading players from banking, funds, insurance, aircraft, and ship lessors, etc. and also held discussions financial and technology leaders on January 10, 2024. At the forum, business leaders applauded with Japan Financial Services Agency (JFSA). the regulatory regime and business environment in GIFT IFSC and offered various suggestions to further enhance the growth of India's maiden IFSC in GIFT City. As part of Vibrant Gujarat Global Summit, Government of Gujarat in collaboration with GIFT Co. Ltd. and IFSCA held a day-long seminar on GIFT City & the IFSC at Mahatma Mandir, Gandhinagar on the theme “GIFT City – An Aspiration of Modern India” on 11th January. The Hon'ble Union Minister of Finance and Corporate Affairs Smt. Nirmala Sitharaman delivered the keynote address at the plenary session of the seminar. At the plenary session, Shri K Rajaraman, Chairperson, IFSCA highlighted various regulatory measures and development related initiatives being implemented by IFSCA to develop a robust financial market ecosystem in GIFT IFSC. Image 33 : Shri K Rajaraman, Chairperson, IFSCA address during interaction with Japanese businesses at IRDAI Insurance Roadshow (Embassy of India, Tokyo) 108 1092023-24 Image 32 : Plenary Session “GIFT City – An Aspiration of Modern India” in Vibrant Gujarat 2024“ (Left to Right) Shri K. Rajaraman, Chairperson, IFSCA;Shri Kanubhai Desai, Finance Minister, Government of Gujarat; Hon'ble Finance Minister, Smt. Nirmala Sitharaman; Shri Hasmukh Adhia, Chairman, GIFT City and Shri Image 31 : Chairperson, IFSCA addressing the officials of Luxembourg Stock Exchange (LSE) Tapan Ray, MD & CEO, GIFT City Visit to Japan Vibrant Gujarat Global Summit 2024 An IFSCA delegation led by Chairperson, IFSCA visited Japan from November 2023 to engage and The 10 edition of Vibrant Gujarat Global Summit 2024 was held between January 10-12 in interact with Japanese financial market institutions and to participate in the IAIS Annual General Gandhinagar, Gujarat. The Hon'ble Prime Minister inaugurated the Summit and presided over the Meeting and Annual Conference. During the visit, IFSCA officials interacted with major market Global FinTech Leadership Forum (GFLF) at GIFT City. The forum was attended by leading players from banking, funds, insurance, aircraft, and ship lessors, etc. and also held discussions financial and technology leaders on January 10, 2024. At the forum, business leaders applauded with Japan Financial Services Agency (JFSA). the regulatory regime and business environment in GIFT IFSC and offered various suggestions to further enhance the growth of India's maiden IFSC in GIFT City. As part of Vibrant Gujarat Global Summit, Government of Gujarat in collaboration with GIFT Co. Ltd. and IFSCA held a day-long seminar on GIFT City & the IFSC at Mahatma Mandir, Gandhinagar on the theme “GIFT City – An Aspiration of Modern India” on 11th January. The Hon'ble Union Minister of Finance and Corporate Affairs Smt. Nirmala Sitharaman delivered the keynote address at the plenary session of the seminar. At the plenary session, Shri K Rajaraman, Chairperson, IFSCA highlighted various regulatory measures and development related initiatives being implemented by IFSCA to develop a robust financial market ecosystem in GIFT IFSC. Image 33 : Shri K Rajaraman, Chairperson, IFSCA address during interaction with Japanese businesses at IRDAI Insurance Roadshow (Embassy of India, Tokyo) 108 1092023-24 Visit to Australia An IFSCA delegation led by Dr. Dipesh Shah, Executive Director, IFSCA, visited Australia in August 2023 to engage and interact with Australian financial institutions and universities on emerging business opportunities in GIFT IFSC. During the visit, several roundtable interactions/conferences/informative sessions were organized in Sydney & Melbourne, cutting across various business verticals such as FinTech, Capital Markets, Asset Management and Australian Universities, etc. IFSCA also participated in Intersekt 23 (prominent FinTech Conference) and interacted with various FinTech-related stakeholders. Image 34 : IFSCA delegation led by Chairperson, IFSCA met Mr. Toshiyuki, Vice-commissioner for International Affairs, FSA, Japan Visit to USA as part of Vibrant Gujrat International Delegation IFSCA officials visited the United States of America in October 2023 as part of Vibrant Gujarat International delegation with Additional Chief Secretary, Finance Department, Government of Gujarat as delegation leader. The visit was undertaken to engage with the business community, including the financial services industry as a precursor to the Vibrant Gujrat Global Summit 2024. During the visit, several key engagements with the US financial services industry and Universities were organized to discuss business opportunities in GIFT IFSC. Image 36: Conference on GIFT IFSC opportunities Image 35 : Opening Bell ceremony at NASDAQ 110 1112023-24 Visit to Australia An IFSCA delegation led by Dr. Dipesh Shah, Executive Director, IFSCA, visited Australia in August 2023 to engage and interact with Australian financial institutions and universities on emerging business opportunities in GIFT IFSC. During the visit, several roundtable interactions/conferences/informative sessions were organized in Sydney & Melbourne, cutting across various business verticals such as FinTech, Capital Markets, Asset Management and Australian Universities, etc. IFSCA also participated in Intersekt 23 (prominent FinTech Conference) and interacted with various FinTech-related stakeholders. Image 34 : IFSCA delegation led by Chairperson, IFSCA met Mr. Toshiyuki, Vice-commissioner for International Affairs, FSA, Japan Visit to USA as part of Vibrant Gujrat International Delegation IFSCA officials visited the United States of America in October 2023 as part of Vibrant Gujarat International delegation with Additional Chief Secretary, Finance Department, Government of Gujarat as delegation leader. The visit was undertaken to engage with the business community, including the financial services industry as a precursor to the Vibrant Gujrat Global Summit 2024. During the visit, several key engagements with the US financial services industry and Universities were organized to discuss business opportunities in GIFT IFSC. Image 36: Conference on GIFT IFSC opportunities Image 35 : Opening Bell ceremony at NASDAQ 110 1112023-24 Key Outreach and engagement activities Date Particulars Remarks During FY 2023-24 following major outreach and engagement activities were carried out in Webinar on 'The Future of A webinar was organised by PwC on the theme collaboration with Indian missions, foreign missions, industry associations, investment Aircraft Leasing from - 'The Future of Aircraft Leasing from IFSC- promotion agencies and other stakeholders. IFSC-India' India'. During the webinar, IFSCA officials highlighted various policy, tax and regulatory Table 29 : Key Outreach and Engagement activities of IFSCA during FY 2023-24 enablers provided for the growth of aircraft leasing business in GIFT IFSC. Date Particulars Remarks India Investment Forum event IFSCA officials participated in the India BCAS 27th International IFSCA officials participated in the 27th organized by Morgan Stanley Investment Forum event organized by Morgan Tax & Finance Conference International Tax and Finance Conference in Mumbai Stanley. A dedicated session on the theme 2023 organized by the Bombay Chartered 'GIFT IFSC: The Opportunity & What Investors Accountants Society (BCAS) in Gandhinagar, Should Know' was organized to disseminate Gujarat. During the conference, GIFT IFSC various opportunities available in GIFT IFSC specific business opportunities were for the financial services industry. presented to the participants including finance professionals. Seminar on GIFT IFSC A seminar was organized by PHD Chamber of organized by PHD Chamber Commerce and Industry on the theme HSBC Conference on the IFSCA officials participated in a conference of Commerce and Industry in “Importance of GIFT City: Attracting Foreign theme “GIFT City: India's organized by HSBC in Singapore to showcase New Delhi Funds for Indian Startups & Tax Incentives for Epicenter of Global Finance various business opportunities in GIFT IFSC. Indian Businesses” in New Delhi. IFSCA and IT” organized in As part of the conference, business officials presented various business Singapore opportunities across funds industry, banking, opportunities available for Indian businesses April 2023 Global in-house Centres and FinTech were June 2023 in GIFT IFSC. presented to then marker participants. Webinar organized by IFSCA officials participated in a webinar SanamS4 Global Summit on IFSCA officials participated in the 'Global Institute of Chartered organized by ICAI on the theme Higher Education "campus Education Summit' organized by SanamS4 Accountants of India (ICAI) "Opportunities arising from India's maiden Development in India” Group in New Delhi. A dedicated session was on GIFT IFSC Opportunities International Financial Services Centre in organized in New Delhi held for presentation the opportunities for for ICAI's Overseas Chapters GIFT City" for educating their overseas foreign universities to set up International chapters about GIFT IFSC opportunities. Branch Campuses (IBCs) in GIFT IFSC. Roundtable Interaction Conference organized by IFSCA officials participated in a conference IFSCA officials attended the roundtable organized by Ministry of Association of Certified organized by Association of Certified Financial interaction organized by Ministry of Commerce and Industries for Financial Crime Specialists Crime Specialists (ACFCS) on theme 'Financial Commerce and Industries with Indian Fund Venture Capital Firms (ACFCS) in New Delhi Crime Compliance Emerging Trends & Managers, Startups and other stakeholders in Opportunities' in New Delhi. New Delhi. Taxand Global Conference 2023 IFSCA officials participated in a conference Inc42 India's: Angel & VC IFSCA officials participated in a conclave organized by Taxand in collaboration with Conclave organized by Inc42 for Angel and VC funds in Economic Laws Practice (ELP). A dedicated India. A dedicated session titled 'The GIFT City session on the theme “IFSC: A Gateway to Advantage: A New Frontier for Private Equity India” was organized to present various Investors' was organized to sensitize the business opportunities available to the audience about the growing opportunities in May 2023 financial services industry in GIFT IFSC. GIFT IFSC for the funds industry. Roadshow by KredX GTX A roadshow was organized in Ahmedabad by KredX on the theme “Experience India's First IFSCA Licensed Global Trade Financing Exchange”. IFSCA officials participated and highlighted the trade financial related opportunities in GIFT IFSC. 112 1132023-24 Key Outreach and engagement activities Date Particulars Remarks During FY 2023-24 following major outreach and engagement activities were carried out in Webinar on 'The Future of A webinar was organised by PwC on the theme collaboration with Indian missions, foreign missions, industry associations, investment Aircraft Leasing from - 'The Future of Aircraft Leasing from IFSC- promotion agencies and other stakeholders. IFSC-India' India'. During the webinar, IFSCA officials highlighted various policy, tax and regulatory Table 29 : Key Outreach and Engagement activities of IFSCA during FY 2023-24 enablers provided for the growth of aircraft leasing business in GIFT IFSC. Date Particulars Remarks India Investment Forum event IFSCA officials participated in the India BCAS 27th International IFSCA officials participated in the 27th organized by Morgan Stanley Investment Forum event organized by Morgan Tax & Finance Conference International Tax and Finance Conference in Mumbai Stanley. A dedicated session on the theme 2023 organized by the Bombay Chartered 'GIFT IFSC: The Opportunity & What Investors Accountants Society (BCAS) in Gandhinagar, Should Know' was organized to disseminate Gujarat. During the conference, GIFT IFSC various opportunities available in GIFT IFSC specific business opportunities were for the financial services industry. presented to the participants including finance professionals. Seminar on GIFT IFSC A seminar was organized by PHD Chamber of organized by PHD Chamber Commerce and Industry on the theme HSBC Conference on the IFSCA officials participated in a conference of Commerce and Industry in “Importance of GIFT City: Attracting Foreign theme “GIFT City: India's organized by HSBC in Singapore to showcase New Delhi Funds for Indian Startups & Tax Incentives for Epicenter of Global Finance various business opportunities in GIFT IFSC. Indian Businesses” in New Delhi. IFSCA and IT” organized in As part of the conference, business officials presented various business Singapore opportunities across funds industry, banking, opportunities available for Indian businesses April 2023 Global in-house Centres and FinTech were June 2023 in GIFT IFSC. presented to then marker participants. Webinar organized by IFSCA officials participated in a webinar SanamS4 Global Summit on IFSCA officials participated in the 'Global Institute of Chartered organized by ICAI on the theme Higher Education "campus Education Summit' organized by SanamS4 Accountants of India (ICAI) "Opportunities arising from India's maiden Development in India” Group in New Delhi. A dedicated session was on GIFT IFSC Opportunities International Financial Services Centre in organized in New Delhi held for presentation the opportunities for for ICAI's Overseas Chapters GIFT City" for educating their overseas foreign universities to set up International chapters about GIFT IFSC opportunities. Branch Campuses (IBCs) in GIFT IFSC. Roundtable Interaction Conference organized by IFSCA officials participated in a conference IFSCA officials attended the roundtable organized by Ministry of Association of Certified organized by Association of Certified Financial interaction organized by Ministry of Commerce and Industries for Financial Crime Specialists Crime Specialists (ACFCS) on theme 'Financial Commerce and Industries with Indian Fund Venture Capital Firms (ACFCS) in New Delhi Crime Compliance Emerging Trends & Managers, Startups and other stakeholders in Opportunities' in New Delhi. New Delhi. Taxand Global Conference 2023 IFSCA officials participated in a conference Inc42 India's: Angel & VC IFSCA officials participated in a conclave organized by Taxand in collaboration with Conclave organized by Inc42 for Angel and VC funds in Economic Laws Practice (ELP). A dedicated India. A dedicated session titled 'The GIFT City session on the theme “IFSC: A Gateway to Advantage: A New Frontier for Private Equity India” was organized to present various Investors' was organized to sensitize the business opportunities available to the audience about the growing opportunities in May 2023 financial services industry in GIFT IFSC. GIFT IFSC for the funds industry. Roadshow by KredX GTX A roadshow was organized in Ahmedabad by KredX on the theme “Experience India's First IFSCA Licensed Global Trade Financing Exchange”. IFSCA officials participated and highlighted the trade financial related opportunities in GIFT IFSC. 112 1132023-24 Date Particulars Remarks Date Particulars Remarks Webinar organized by Invest IFSCA officials participated in a webinar Webinar on “GIFT IFSC – IFSCA officials participated in the webinar India on the Foreign organized by Invest India to disseminate A Gateway to Global Capital organized by NSE on the theme 'GIFT IFSC – A University initiative in information on IFSCA (setting up and Market ” Gateway to Global Capital Market'. During the GIFT IFSC operations of International Branch Campuses webinar, IFSCA officials highlighted various and Offshore Education Centres) Regulations regulatory enablers provided for the growth of 2022 and highlight various advantages of capital market ecosystem in GIFT IFSC. setting up branch campuses in IFSC. Workshop organized by IFSCA officials participated in the workshop Seminar on “Discovering the IFSCA officials participated in a day long Ernst and Young, India on organized by Ernst and Young on the taxation Future: Expedition to FinTech seminar organized by PHD Chambers the taxation system in India system in India. During the workshop, IFSCA GIFT City” of Commerce in GIFT IFSC. During the seminar, officials sensitized the stakeholders about various tax incentives available to IFSC IFSCA officials presented various June 2023 entities. opportunities available for FinTech firms in GIFT IFSC. Roundtable Meeting in IFSC organized a roundtable meeting with Mumbai on 'Opportunities aircraft lessors, airlines, financial institutions Webinar organized by FCDO, Foreign, Commonwealth and Development September for Aircraft Leasing from and related market participants in Mumbai. UK on International Branch Office (FCDO), UK organized a webinar with 2023 GIFT IFSC’ During the meeting, a detailed presentation Campus opportunities in leading UK Universities to showcase and was made on various progressive policy and GIFT IFSC present 'International Branch Campus tax reforms carried out by the Government of opportunities available in GIFT IFSC. During India to enable the growth of Aircraft leasing the webinar, IFSCA officials made a detailed business in GIFT IFSC. presentation on IFSCA (setting up and operations of International Branch Campuses Roundtable Meeting in IFSCA organized a roundtable meeting with and Offshore Education Centres) Regulations Mumbai on 'Funds ecosystem leading Fund Managers in Mumbai. As part of 2022. in GIFT IFSC' the roundtable interaction, IFSCA officials presented the regulatory and tax landscape for Global FinTech Fest 2023 IFSCA participated in the Global FinTech Fest asset management industry in GIFT IFSC. 2023 held in Mumbai. During the FinTech fest, Chairperson, IFSCA delivered a keynote Webinar on Global Education IFSCA officials virtually participated in the address on the topic “Transforming FinTech Conclave 2.0 Global Education Conclave 2.0 organized by landscape through innovation and responsible One Step Global to disseminate International global collaboration”. Branch Campus opportunities available to foreign universities in GIFT IFSC. Dubai Hedge Fund Conference IFSCA officials participated in the Dubai Hedge Fund Conference organized by Wealth Today. Event: The Network IFSCA officials participated in The Network During the conference, IFSCA officials Forum-Asia Forum- Asia event held in Mumbai. During the presented opportunities for global fund event, a detailed presentation was made by September managers in GIFT IFSC. IFSCA official on “Onboarding Indian 2023 Innovations to GIFT IFSC”. During the event, Delegation visits by Ministry IFSCA Officials held a meeting with the various opportunities available to the startups of Finance officials delegation of the Ministry of Finance, Bahrain November community in GIFT IFSC were also presented. from Bahrain to explore investment opportunities in GIFT 2023 IFSC. Meeting with Australian IFSCA officials held a meeting with the officials Seminar on Regulatory IFSCA officials participated in a seminar on Self-Managed Super Fund of the Australian Self-Managed Super Fund. Development by 'Regulatory Developments' organized by the During the meeting, IFSCA officials presented AMCHAM India American Chamber of Commerce in India the regulatory and tax landscape for the asset (AMCHAM). During the seminar, IFSCA management industry in GIFT IFSC. officials highlighted the latest regulatory and business developments in GIFT IFSC. 114 1152023-24 Date Particulars Remarks Date Particulars Remarks Webinar organized by Invest IFSCA officials participated in a webinar Webinar on “GIFT IFSC – IFSCA officials participated in the webinar India on the Foreign organized by Invest India to disseminate A Gateway to Global Capital organized by NSE on the theme 'GIFT IFSC – A University initiative in information on IFSCA (setting up and Market ” Gateway to Global Capital Market'. During the GIFT IFSC operations of International Branch Campuses webinar, IFSCA officials highlighted various and Offshore Education Centres) Regulations regulatory enablers provided for the growth of 2022 and highlight various advantages of capital market ecosystem in GIFT IFSC. setting up branch campuses in IFSC. Workshop organized by IFSCA officials participated in the workshop Seminar on “Discovering the IFSCA officials participated in a day long Ernst and Young, India on organized by Ernst and Young on the taxation Future: Expedition to FinTech seminar organized by PHD Chambers the taxation system in India system in India. During the workshop, IFSCA GIFT City” of Commerce in GIFT IFSC. During the seminar, officials sensitized the stakeholders about various tax incentives available to IFSC IFSCA officials presented various June 2023 entities. opportunities available for FinTech firms in GIFT IFSC. Roundtable Meeting in IFSC organized a roundtable meeting with Mumbai on 'Opportunities aircraft lessors, airlines, financial institutions Webinar organized by FCDO, Foreign, Commonwealth and Development September for Aircraft Leasing from and related market participants in Mumbai. UK on International Branch Office (FCDO), UK organized a webinar with 2023 GIFT IFSC’ During the meeting, a detailed presentation Campus opportunities in leading UK Universities to showcase and was made on various progressive policy and GIFT IFSC present 'International Branch Campus tax reforms carried out by the Government of opportunities available in GIFT IFSC. During India to enable the growth of Aircraft leasing the webinar, IFSCA officials made a detailed business in GIFT IFSC. presentation on IFSCA (setting up and operations of International Branch Campuses Roundtable Meeting in IFSCA organized a roundtable meeting with and Offshore Education Centres) Regulations Mumbai on 'Funds ecosystem leading Fund Managers in Mumbai. As part of 2022. in GIFT IFSC' the roundtable interaction, IFSCA officials presented the regulatory and tax landscape for Global FinTech Fest 2023 IFSCA participated in the Global FinTech Fest asset management industry in GIFT IFSC. 2023 held in Mumbai. During the FinTech fest, Chairperson, IFSCA delivered a keynote Webinar on Global Education IFSCA officials virtually participated in the address on the topic “Transforming FinTech Conclave 2.0 Global Education Conclave 2.0 organized by landscape through innovation and responsible One Step Global to disseminate International global collaboration”. Branch Campus opportunities available to foreign universities in GIFT IFSC. Dubai Hedge Fund Conference IFSCA officials participated in the Dubai Hedge Fund Conference organized by Wealth Today. Event: The Network IFSCA officials participated in The Network During the conference, IFSCA officials Forum-Asia Forum- Asia event held in Mumbai. During the presented opportunities for global fund event, a detailed presentation was made by September managers in GIFT IFSC. IFSCA official on “Onboarding Indian 2023 Innovations to GIFT IFSC”. During the event, Delegation visits by Ministry IFSCA Officials held a meeting with the various opportunities available to the startups of Finance officials delegation of the Ministry of Finance, Bahrain November community in GIFT IFSC were also presented. from Bahrain to explore investment opportunities in GIFT 2023 IFSC. Meeting with Australian IFSCA officials held a meeting with the officials Seminar on Regulatory IFSCA officials participated in a seminar on Self-Managed Super Fund of the Australian Self-Managed Super Fund. Development by 'Regulatory Developments' organized by the During the meeting, IFSCA officials presented AMCHAM India American Chamber of Commerce in India the regulatory and tax landscape for the asset (AMCHAM). During the seminar, IFSCA management industry in GIFT IFSC. officials highlighted the latest regulatory and business developments in GIFT IFSC. 114 1152023-24 Date Particulars Remarks Date Particulars Remarks APLMA India Loan Market IFSCA officials participated in the conference Workshop on "Potential of IFSCA officials participated in workshop on Conference organized by Asia Pacific Loan Market Civil Aviation Sector in "Potential of Civil Aviation Sector in Indian Association (APLMA) on the India Loan Indian Economy” Economy” to present aircraft financing and Market opportunities. During the conference, leasing ecosystem in GIFT IFSC. IFSCA officials presented various business Meeting with Taiwan Bankers IFSCA officials participated in a Virtual opportunities available in India's maiden IFSC Association Conference (VC) organized by Tiawan Bankers in GIFT City. Association to discuss banking sector Webinar on Listing of IFSCA officials participated in a webinar opportunities in GIFT IFSC. During the Indian Companies on organized by American Bar Association on March meeting, IFSCA officials presented the foreign exchanges listing opportunities in GIFT IFSC. During the 2024 business and regulatory landscape of the webinar, IFSCA officials presented the banking sectors in GIFT IFSC. business and regulatory landscape available for the entities looking to list their securities PHD Chamber of Commerce IFSCA officials participated in the event on the International Stock Exchanges in GIFT and Industry Event: Where organized by PHD Chamber of Commerce and IFSC. Finance meets Technology Industry in GIFT City. During the event, IFSCA officials presented various business Wings India 2024 Hyderabad IFSCA officials participated in Wings India opportunities available in GIFT IFSC across conference organized by Ministry of Civil banking, funds industry, insurance, FinTech, Aviation. IFSCA officials also participated in etc. the Panel Discussion on Aircraft Leasing & Financing Meeting with Global IFSCA officials held a meeting with Global Organization of People Organization of People of Indian Origin of Indian Origin (GOPIO) (GOPIO) highlight the present regulatory and business opportunities in GIFT IFSC. December Event on GIFT IFSC Chairperson, IFSCA gave the keynote address 2023 Opportunities organized by at the event organized by PHD Chamber of PHD Chamber of Commerce Commerce and Industry on GIFT IFSC and Industry opportunities in New Delhi. Workshop on 'GIFT City – IFSCA officials participated in the workshop Global / Regional Treasury organized by Standard Chartered Bank on Centre (RTC)' GIFT IFSC – Global / Regional Treasury Centre (RTC) opportunities in GIFT IFSC. Webinar to discuss IBC IFSCA officials participated in a Webinar opportunities for Irish organized by Ireland India Business Universities in GIFT IFSC Association for Irish Universities to understand International Branch Campus opportunities in GIFT IFSC. IOSCO Asia-Pacific Regional A delegation from IFSCA participated in the Committee (APRC) International Organization of Securities Commission (IOSCO) Asia-Pacific Regional Committee (APRC) and the EU-Asia Pacific Regulatory Forum held from February 26-28, 2024, in Hong Kong. 116 1172023-24 Date Particulars Remarks Date Particulars Remarks APLMA India Loan Market IFSCA officials participated in the conference Workshop on "Potential of IFSCA officials participated in workshop on Conference organized by Asia Pacific Loan Market Civil Aviation Sector in "Potential of Civil Aviation Sector in Indian Association (APLMA) on the India Loan Indian Economy” Economy” to present aircraft financing and Market opportunities. During the conference, leasing ecosystem in GIFT IFSC. IFSCA officials presented various business Meeting with Taiwan Bankers IFSCA officials participated in a Virtual opportunities available in India's maiden IFSC Association Conference (VC) organized by Tiawan Bankers in GIFT City. Association to discuss banking sector Webinar on Listing of IFSCA officials participated in a webinar opportunities in GIFT IFSC. During the Indian Companies on organized by American Bar Association on March meeting, IFSCA officials presented the foreign exchanges listing opportunities in GIFT IFSC. During the 2024 business and regulatory landscape of the webinar, IFSCA officials presented the banking sectors in GIFT IFSC. business and regulatory landscape available for the entities looking to list their securities PHD Chamber of Commerce IFSCA officials participated in the event on the International Stock Exchanges in GIFT and Industry Event: Where organized by PHD Chamber of Commerce and IFSC. Finance meets Technology Industry in GIFT City. During the event, IFSCA officials presented various business Wings India 2024 Hyderabad IFSCA officials participated in Wings India opportunities available in GIFT IFSC across conference organized by Ministry of Civil banking, funds industry, insurance, FinTech, Aviation. IFSCA officials also participated in etc. the Panel Discussion on Aircraft Leasing & Financing Meeting with Global IFSCA officials held a meeting with Global Organization of People Organization of People of Indian Origin of Indian Origin (GOPIO) (GOPIO) highlight the present regulatory and business opportunities in GIFT IFSC. December Event on GIFT IFSC Chairperson, IFSCA gave the keynote address 2023 Opportunities organized by at the event organized by PHD Chamber of PHD Chamber of Commerce Commerce and Industry on GIFT IFSC and Industry opportunities in New Delhi. Workshop on 'GIFT City – IFSCA officials participated in the workshop Global / Regional Treasury organized by Standard Chartered Bank on Centre (RTC)' GIFT IFSC – Global / Regional Treasury Centre (RTC) opportunities in GIFT IFSC. Webinar to discuss IBC IFSCA officials participated in a Webinar opportunities for Irish organized by Ireland India Business Universities in GIFT IFSC Association for Irish Universities to understand International Branch Campus opportunities in GIFT IFSC. IOSCO Asia-Pacific Regional A delegation from IFSCA participated in the Committee (APRC) International Organization of Securities Commission (IOSCO) Asia-Pacific Regional Committee (APRC) and the EU-Asia Pacific Regulatory Forum held from February 26-28, 2024, in Hong Kong. 116 1172023-24 QUASI-LEGISLATIVE FUNCTIONS Table 30 : List of Regulations OF THE AUTHORITY IFSCA has been established as a unified regulator to develop and regulate the financial services IFSCA (Re-insurance) 11/04/2023 The regulations inter-alia provides for detailed Regulations, 2023 framework for oversight and control of inward market in the IFSCs in India. The Authority can perform all such executive, quasi-legislative and IFSCA/2022- and outward arrangement of re-insurance by quasi-judicial functions in IFSCs, as are being performed by the domestic financial sector 23/GN/REG036 the IFSC Insurance Offices (IIOs), regulators in India, namely, RBI, SEBI, PFRDA and IRDAI. Section 12 of the IFSCA Act, 2019 wherein a part of the risks assumed by an IIO is empowers IFSCA to develop and regulate financial products, financial services, and financial ceded to another IIO or the re-insurer. institutions in an IFSC. It can also recommend to the Central Government certain financial products, financial services, and financial institutions which may be permitted in an IFSC. Further, IFSCA (Fund 11/04/2023 Vide the amendments the funds of a client Management) availing portfolio management services (other under section 13 of the Act, IFSCA can exercise all powers exercisable by the aforesaid four (Amendment) than those availing only advisory services) may domestic regulators with respect to certain Acts specified under the First Schedule of the Act in so Regulations, 2023 be maintained in: far as they relate to financial products, financial services, and financial institutions in the IFSCs. IFSCA/2022- (a) a specific bank account of the FME in a 23/GN/REG034 The Authority while exercising its quasi-legislative powers has notified regulations on multiple Banking Unit. (b) a specific bank account of the client in a areas. Apart from the core activities of banking, capital markets and insurance, the regulations Banking Unit, a bank in India or a Foreign have also been framed on administrative and miscellaneous matters. To give effect to the Jurisdiction; or functioning of various financial products and financial services regulated by the Authority, the (c) any other manner as may be specified by following regulations, major notifications, guidelines, and circulars have been issued: the Authority. IFSCA (Assets, 19/04/2023 The Authority has issued these regulations to Liabilities, Solvency inter-alia provide for the regulatory Margin and Abstract of requirements towards maintenance of capital Actuarial Report for and solvency margins for transacting insurance Life Insurance business by IIOs registered with the Authority, Business) Regulations, whether set up in an incorporated or in 2023 IFSCA/2022- unincorporated form in the IFSC. 23/GN/REG039 IFSCA (Assets, 19/04/2023 Liabilities, and Solvency Margin of General, Health and Re- insurance business) Regulations, 2023 IFSCA/2022- 23/GN/REG038 IFSCA (Management 26/04/2023 In order to strengthen the regulatory Control, Administrative framework related to Management Control, Control and Administrative Controls and Market Conduct of Market Conduct of insurance business carried out by IFSC insurance business) Insurance Office (IIO) or IFSC Insurance Regulations, 2023 Intermediary Office (IIIO), the Authority has IFSCA/2022- issued comprehensive regulations by adopting 23/GN/REG035 120 1212023-24 QUASI-LEGISLATIVE FUNCTIONS Table 30 : List of Regulations OF THE AUTHORITY IFSCA has been established as a unified regulator to develop and regulate the financial services IFSCA (Re-insurance) 11/04/2023 The regulations inter-alia provides for detailed Regulations, 2023 framework for oversight and control of inward market in the IFSCs in India. The Authority can perform all such executive, quasi-legislative and IFSCA/2022- and outward arrangement of re-insurance by quasi-judicial functions in IFSCs, as are being performed by the domestic financial sector 23/GN/REG036 the IFSC Insurance Offices (IIOs), regulators in India, namely, RBI, SEBI, PFRDA and IRDAI. Section 12 of the IFSCA Act, 2019 wherein a part of the risks assumed by an IIO is empowers IFSCA to develop and regulate financial products, financial services, and financial ceded to another IIO or the re-insurer. institutions in an IFSC. It can also recommend to the Central Government certain financial products, financial services, and financial institutions which may be permitted in an IFSC. Further, IFSCA (Fund 11/04/2023 Vide the amendments the funds of a client Management) availing portfolio management services (other under section 13 of the Act, IFSCA can exercise all powers exercisable by the aforesaid four (Amendment) than those availing only advisory services) may domestic regulators with respect to certain Acts specified under the First Schedule of the Act in so Regulations, 2023 be maintained in: far as they relate to financial products, financial services, and financial institutions in the IFSCs. IFSCA/2022- (a) a specific bank account of the FME in a 23/GN/REG034 The Authority while exercising its quasi-legislative powers has notified regulations on multiple Banking Unit. (b) a specific bank account of the client in a areas. Apart from the core activities of banking, capital markets and insurance, the regulations Banking Unit, a bank in India or a Foreign have also been framed on administrative and miscellaneous matters. To give effect to the Jurisdiction; or functioning of various financial products and financial services regulated by the Authority, the (c) any other manner as may be specified by following regulations, major notifications, guidelines, and circulars have been issued: the Authority. IFSCA (Assets, 19/04/2023 The Authority has issued these regulations to Liabilities, Solvency inter-alia provide for the regulatory Margin and Abstract of requirements towards maintenance of capital Actuarial Report for and solvency margins for transacting insurance Life Insurance business by IIOs registered with the Authority, Business) Regulations, whether set up in an incorporated or in 2023 IFSCA/2022- unincorporated form in the IFSC. 23/GN/REG039 IFSCA (Assets, 19/04/2023 Liabilities, and Solvency Margin of General, Health and Re- insurance business) Regulations, 2023 IFSCA/2022- 23/GN/REG038 IFSCA (Management 26/04/2023 In order to strengthen the regulatory Control, Administrative framework related to Management Control, Control and Administrative Controls and Market Conduct of Market Conduct of insurance business carried out by IFSC insurance business) Insurance Office (IIO) or IFSC Insurance Regulations, 2023 Intermediary Office (IIIO), the Authority has IFSCA/2022- issued comprehensive regulations by adopting 23/GN/REG035 120 1212023-24 international best practices. The regulations c) Escrow service; inter-alia provides regulatory framework for - d) Cross border money transfer service; and e) Merchant acquisition. (1) Capital related issues and Management control; By enabling the above services to be provided (2) Minimum Limits for Annuities and other out of IFSC, the regulations allow financial Benefits; institutions in IFSC to provide as well as receive (3) Acquisition of Surrender and Paid up a wide range of financial services that facilitate values; the transfer of money between individuals, (4) Expenses of Management of IIOs; businesses, and other entities. (5) Payment of Commission or Remuneration The regulations would also permit Indian or Reward to Insurance Intermediaries; FinTech entities looking to offer their products (6) Protection of Policyholders' Interests; and globally to develop IFSC as their base to expand (7) Insurance Advertisements and Disclosure. their offerings to jurisdictions across the world. 6 IFSCA (Banking) 06/07/2023 The regulations inter-alia amended the certain (Amendment) definitions under IFSCA (Banking) Regulations, 2023 Regulations, 2020. The definition of “IFSC IFSCA/2023- Banking Company” was included in order to Table 31 : List of Major Notifications 24/GN/REG041 enable Banking Unit subsidiary company of the Parent Bank. Further, under the First Schedule specified 11 foreign currencies inter-alia include US Dollar (USD), Euro (EUR), 1 Enabling lease of 11/04/2023 To notify an operating lease, including hybrid of Japanese Yen (JPY), UK Pound Sterling (GBP), 'Aviation training operating and financial lease, in respect of Canadian Dollar (CAD), etc. simulation devices' as a 'Aviation training simulation devices', as a financial product in 7 IFSCA (Capital Market 10/07/2023 Certain new definitions have been inserted financial product, u/s 3(1) (d) of IFSCA Act, IFSC IFSCA/2022- Intermediaries) under the IFSCA (Capital Market 2019. 23/GN/037 (Amendment) Intermediaries) Regulations, 2021. The Regulations 2023 inclusion inter-alia include definition of IFSCA/2023- “capital market intermediary”, “distributor” 2 Notification of Book- 18/01/2024 To notify the following services as financial 24/GN/REG040 and “registered distributor”. keeping, accounting, services, u/s 3(1) (e) of IFSCA Act, 2019 taxation and financial namely: - 8 IFSCA (Investment by 25/10/2023 Minor changes in the provisions of the IFSCA crime compliance i) book-keeping services; services under as International Financial (Investment by International Financial ii) accounting services; financial service under Services Centre Services Centre Insurance Office) Regulations, iii) taxation services; and the IFSCA Act, 2019 Insurance Office) 2022 have been carried out. iv) financial crime compliance services. S.O. 291(E) (Amendment) Regulations, 2023 3 Foreign Exchange 24/01/2024 The notification was issued to make certain IFSCA/2023- Management (Non- amendments in the Foreign Exchange 24/GN/REG042 debt Instruments) Management (Non- debt Instruments) Rules, Amendment Rules, 2019. The amendments inter-alia was carried 9 IFSCA (Payment 29/01/2024 The regulations inter-alia lay down the 2024 S.O. 332 (E) out under certain definitions. Services) Regulations, framework for entities providing the following 2024 IFSCA / GN / payment services to seek authorisation from Additionally, new schedule was inserted under 2024 /001 IFSCA: the aforesaid rules, pertaining to Direct Listing of Equity Shares of Companies Incorporated in a) Account issuance service (including e- India on International Exchanges Scheme. money account issuance service); b) E-money issuance service; 122 1232023-24 international best practices. The regulations c) Escrow service; inter-alia provides regulatory framework for - d) Cross border money transfer service; and e) Merchant acquisition. (1) Capital related issues and Management control; By enabling the above services to be provided (2) Minimum Limits for Annuities and other out of IFSC, the regulations allow financial Benefits; institutions in IFSC to provide as well as receive (3) Acquisition of Surrender and Paid up a wide range of financial services that facilitate values; the transfer of money between individuals, (4) Expenses of Management of IIOs; businesses, and other entities. (5) Payment of Commission or Remuneration The regulations would also permit Indian or Reward to Insurance Intermediaries; FinTech entities looking to offer their products (6) Protection of Policyholders' Interests; and globally to develop IFSC as their base to expand (7) Insurance Advertisements and Disclosure. their offerings to jurisdictions across the world. 6 IFSCA (Banking) 06/07/2023 The regulations inter-alia amended the certain (Amendment) definitions under IFSCA (Banking) Regulations, 2023 Regulations, 2020. The definition of “IFSC IFSCA/2023- Banking Company” was included in order to Table 31 : List of Major Notifications 24/GN/REG041 enable Banking Unit subsidiary company of the Parent Bank. Further, under the First Schedule specified 11 foreign currencies inter-alia include US Dollar (USD), Euro (EUR), 1 Enabling lease of 11/04/2023 To notify an operating lease, including hybrid of Japanese Yen (JPY), UK Pound Sterling (GBP), 'Aviation training operating and financial lease, in respect of Canadian Dollar (CAD), etc. simulation devices' as a 'Aviation training simulation devices', as a financial product in 7 IFSCA (Capital Market 10/07/2023 Certain new definitions have been inserted financial product, u/s 3(1) (d) of IFSCA Act, IFSC IFSCA/2022- Intermediaries) under the IFSCA (Capital Market 2019. 23/GN/037 (Amendment) Intermediaries) Regulations, 2021. The Regulations 2023 inclusion inter-alia include definition of IFSCA/2023- “capital market intermediary”, “distributor” 2 Notification of Book- 18/01/2024 To notify the following services as financial 24/GN/REG040 and “registered distributor”. keeping, accounting, services, u/s 3(1) (e) of IFSCA Act, 2019 taxation and financial namely: - 8 IFSCA (Investment by 25/10/2023 Minor changes in the provisions of the IFSCA crime compliance i) book-keeping services; services under as International Financial (Investment by International Financial ii) accounting services; financial service under Services Centre Services Centre Insurance Office) Regulations, iii) taxation services; and the IFSCA Act, 2019 Insurance Office) 2022 have been carried out. iv) financial crime compliance services. S.O. 291(E) (Amendment) Regulations, 2023 3 Foreign Exchange 24/01/2024 The notification was issued to make certain IFSCA/2023- Management (Non- amendments in the Foreign Exchange 24/GN/REG042 debt Instruments) Management (Non- debt Instruments) Rules, Amendment Rules, 2019. The amendments inter-alia was carried 9 IFSCA (Payment 29/01/2024 The regulations inter-alia lay down the 2024 S.O. 332 (E) out under certain definitions. Services) Regulations, framework for entities providing the following 2024 IFSCA / GN / payment services to seek authorisation from Additionally, new schedule was inserted under 2024 /001 IFSCA: the aforesaid rules, pertaining to Direct Listing of Equity Shares of Companies Incorporated in a) Account issuance service (including e- India on International Exchanges Scheme. money account issuance service); b) E-money issuance service; 122 1232023-24 Table 32 : List of Major Circulars/ Guidelines 4 Companies (Listing of 24/01/2024 The notification was issued by Ministry of equity shares in Corporate Affairs. The Rules extend to unlisted 41 Addendum to the 06/04/2023 The Addendum was issued to include following permissible and listed public companies that seek to issue circular related to ancillary services under the head of jurisdictions) securities for listing on permitted stock “Framework for Rules, 2024 Professional Services under the Ancillary enabling ancillary exchanges in permissible foreign jurisdictions, G.S.R. 61(E) Framework: services at including the International Financial Services International Financial (I) Voice broking services to entities in IFSC or Centre (IFSC). Services Centre” from outside India in relation to business of The rules inter-alia specifies the India (Ancillary Framework) banking; International Exchange and NSE International 206/IFSCA/Anc. Aux (ii) Ship broking for permitted activities under Exchange as permitted platforms for such /2020-21 “IFSCA Framework for ship leasing”. listings. Moreover, the MCA has identified certain entities that are not eligible under these 2 Utilisation of office 18/04/2023 The amendment to SEZ Rules, vide insertion of regulations, which include Nidhi Companies space or manpower or Rule 21B exempted Finance Company (FCs) or and companies limited by guarantee. both by entities Finance Unit (FUs) undertaking aircraft leasing undertaking aircraft activity in IFSC from the requirement of 5 Delegation of powers of 28/02/2024 As a measure of unifying the regulatory leasing activity in the maintaining separate office, alternatively Development framework and for ease of doing business to the International Financial enabled them to utilise office space or Commissioner under Services Centre Units proposing to set up their offices in GIFT manpower or both, of a FC or FU undertaking SEZ Act to 535/IFSCA/FC/ALF/20 IFSC, the Government of India vide Gazette aircraft leasing activity in IFSC, post seeking Administrator (IFSCA) 23-24/02 S.O. 940(E) Notification u/s 31 of the IFSCA Act, 2019 dated approval from IFSCA. 28.02.2024 has vested the powers of In furtherance to this, the Guidelines were Development Commissioner under SEZ Act issued specifying the conditions and other 2005, with respect to IFSC units, to an officer requirements for utilisation of office space or nominated by the IFSCA to be designated as manpower or both by entities undertaking “Administrator (IFSCA)”. aircraft leasing activity in the IFSC. This move aims to ensure that instead of following up with the offices of IFSCA and 3 Direct Market Access 21/06/2023 The DMA Facility allows Broker-Dealers to Development Commissioner of GIFT SEZ, now (DMA) facility offer their clients direct access to the trading IFSCA/CMD- the entities can approach only IFSCA for all the system of the Stock Exchange, through the DMIIT/EXCHTRD/202 required approvals, whether under SEZ Act or Broker-Dealer's trading systems, without any 3-24/001 IFSCA Act. manual intervention by the Broker-Dealer. The circular inter-alia specified responsi- bilities of the Broker-Dealer & due diligence of prospective clients, facility of Sponsored Access (SA), Sub-delegation of DMA/SA., etc. 4 Co-location facility 23/06/2023 The circular inter-alia provides for Fair and offered by the Stock equitable co-location services with respect to Exchanges the data centres that are owned and managed IFSCA/CMD- by the Stock Exchange, among other things. DMIIT/EXCHTRD/202 3-24/002 124 1252023-24 Table 32 : List of Major Circulars/ Guidelines 4 Companies (Listing of 24/01/2024 The notification was issued by Ministry of equity shares in Corporate Affairs. The Rules extend to unlisted 41 Addendum to the 06/04/2023 The Addendum was issued to include following permissible and listed public companies that seek to issue circular related to ancillary services under the head of jurisdictions) securities for listing on permitted stock “Framework for Rules, 2024 Professional Services under the Ancillary enabling ancillary exchanges in permissible foreign jurisdictions, G.S.R. 61(E) Framework: services at including the International Financial Services International Financial (I) Voice broking services to entities in IFSC or Centre (IFSC). Services Centre” from outside India in relation to business of The rules inter-alia specifies the India (Ancillary Framework) banking; International Exchange and NSE International 206/IFSCA/Anc. Aux (ii) Ship broking for permitted activities under Exchange as permitted platforms for such /2020-21 “IFSCA Framework for ship leasing”. listings. Moreover, the MCA has identified certain entities that are not eligible under these 2 Utilisation of office 18/04/2023 The amendment to SEZ Rules, vide insertion of regulations, which include Nidhi Companies space or manpower or Rule 21B exempted Finance Company (FCs) or and companies limited by guarantee. both by entities Finance Unit (FUs) undertaking aircraft leasing undertaking aircraft activity in IFSC from the requirement of 5 Delegation of powers of 28/02/2024 As a measure of unifying the regulatory leasing activity in the maintaining separate office, alternatively Development framework and for ease of doing business to the International Financial enabled them to utilise office space or Commissioner under Services Centre Units proposing to set up their offices in GIFT manpower or both, of a FC or FU undertaking SEZ Act to 535/IFSCA/FC/ALF/20 IFSC, the Government of India vide Gazette aircraft leasing activity in IFSC, post seeking Administrator (IFSCA) 23-24/02 S.O. 940(E) Notification u/s 31 of the IFSCA Act, 2019 dated approval from IFSCA. 28.02.2024 has vested the powers of In furtherance to this, the Guidelines were Development Commissioner under SEZ Act issued specifying the conditions and other 2005, with respect to IFSC units, to an officer requirements for utilisation of office space or nominated by the IFSCA to be designated as manpower or both by entities undertaking “Administrator (IFSCA)”. aircraft leasing activity in the IFSC. This move aims to ensure that instead of following up with the offices of IFSCA and 3 Direct Market Access 21/06/2023 The DMA Facility allows Broker-Dealers to Development Commissioner of GIFT SEZ, now (DMA) facility offer their clients direct access to the trading IFSCA/CMD- the entities can approach only IFSCA for all the system of the Stock Exchange, through the DMIIT/EXCHTRD/202 required approvals, whether under SEZ Act or Broker-Dealer's trading systems, without any 3-24/001 IFSCA Act. manual intervention by the Broker-Dealer. The circular inter-alia specified responsi- bilities of the Broker-Dealer & due diligence of prospective clients, facility of Sponsored Access (SA), Sub-delegation of DMA/SA., etc. 4 Co-location facility 23/06/2023 The circular inter-alia provides for Fair and offered by the Stock equitable co-location services with respect to Exchanges the data centres that are owned and managed IFSCA/CMD- by the Stock Exchange, among other things. DMIIT/EXCHTRD/202 3-24/002 124 1252023-24 5 The IFSCA Banking 10/07/2023 The directions under these PRU modules are 8 Framework for grant of 04/12/2023 IFSCA issued the circular on “Framework for Handbook: Prudential aimed at establishing certain minimum non- funds for research Grant of Funds for Research Studies by Directions – V 4.0 quantitative prudential requirements that shall studies by IFSCA IFSCA” to conduct research studies with the (PRU) 1068/IFSCA/EPA/Rese be applicable for the IBUs set up as branches in objective to aid IFSCA in designing policies and arch/2023-24 IFSC, in addition to those applicable on them as in evaluating the impact of a branch of the Banking Company under the implemented policies in GIFT IFSC by respective Home Regulations. The PRU undertaking effective research backed by modules cover the qualitative aspects of strong analytical and empirical formulations. prudential requirements in respect of governance, governing board responsibilities, 9 Permitting 14/12/2023 The circular is issued in order to facilitate International Branch policies, systems, and controls to be made setting up of high-quality campus Campuses (IBCs) and applicable on IBUs. infrastructure facilities in GIFT IFSC, this Offshore Educational circular is being issued to specify conditions for The V 4.0 (PRU) has inter-alia amended certain Centres (OECs) at GIFT- IBCs and/or OECs for availing infrastructure provisions pertaining to direction on Stress IFSC to avail infrastructure services and other support services from an AISP. testing and guidance for undertaking stress testing. from Academic While the AISPs shall be governed as per the Infrastructure Service provisions of the SEZ Act 2005, applicable rules Providers (AISPs) 6 The IFSCA Banking 10/07/2023 The IFSCA Banking Handbook ('Handbook') and regulations, the IBCs/OECs shall adhere to IFSCA BDev./FU/ Handbook Conduct of contains the directions of the Authority to the the conditions specified in this circular, for 1/2023-BD General Directions- V Banking Units (BUs) operating as branch of a availing their services. The enablement under 4.0 (GEN) Banking Company (also referred to as 'parent the aforementioned circular shall only govern bank' in the IFSCA Banking Regulations). the relationship between AISP and IBC/ OEC This module deal with licencing of IBUs, and does not apply to an IBC/OEC seeking defining 'controlled' and 'designated' functions support services other than Campus and the requirements from 'approved Infrastructure Services. /authorised individuals' who can carry out such functions. The GEN directions also lay out the broad principles for banking business and provide information about the Authority's supervisory powers, functions, and approach. The GEN Directions V 4.0 has amended the provisions inter-alia pertaining to Principles of Governance, Outsourcing. 7 The IFSCA Banking 10/07/2023 The COB directions are aimed at ensuring that Handbook: Conduct of IFSC Banking Units (IBUs) meet the minimum Business Directions- standards of conduct expected, particularly (CoB) V 5.0 with regard to the treatment of their clients, their dealings with counterparties and other market participants. The CoB 5.0 amends certain provisions related to definition and permitted activities. 126 1272023-24 5 The IFSCA Banking 10/07/2023 The directions under these PRU modules are 8 Framework for grant of 04/12/2023 IFSCA issued the circular on “Framework for Handbook: Prudential aimed at establishing certain minimum non- funds for research Grant of Funds for Research Studies by Directions – V 4.0 quantitative prudential requirements that shall studies by IFSCA IFSCA” to conduct research studies with the (PRU) 1068/IFSCA/EPA/Rese be applicable for the IBUs set up as branches in objective to aid IFSCA in designing policies and arch/2023-24 IFSC, in addition to those applicable on them as in evaluating the impact of a branch of the Banking Company under the implemented policies in GIFT IFSC by respective Home Regulations. The PRU undertaking effective research backed by modules cover the qualitative aspects of strong analytical and empirical formulations. prudential requirements in respect of governance, governing board responsibilities, 9 Permitting 14/12/2023 The circular is issued in order to facilitate International Branch policies, systems, and controls to be made setting up of high-quality campus Campuses (IBCs) and applicable on IBUs. infrastructure facilities in GIFT IFSC, this Offshore Educational circular is being issued to specify conditions for The V 4.0 (PRU) has inter-alia amended certain Centres (OECs) at GIFT- IBCs and/or OECs for availing infrastructure provisions pertaining to direction on Stress IFSC to avail infrastructure services and other support services from an AISP. testing and guidance for undertaking stress testing. from Academic While the AISPs shall be governed as per the Infrastructure Service provisions of the SEZ Act 2005, applicable rules Providers (AISPs) 6 The IFSCA Banking 10/07/2023 The IFSCA Banking Handbook ('Handbook') and regulations, the IBCs/OECs shall adhere to IFSCA BDev./FU/ Handbook Conduct of contains the directions of the Authority to the the conditions specified in this circular, for 1/2023-BD General Directions- V Banking Units (BUs) operating as branch of a availing their services. The enablement under 4.0 (GEN) Banking Company (also referred to as 'parent the aforementioned circular shall only govern bank' in the IFSCA Banking Regulations). the relationship between AISP and IBC/ OEC This module deal with licencing of IBUs, and does not apply to an IBC/OEC seeking defining 'controlled' and 'designated' functions support services other than Campus and the requirements from 'approved Infrastructure Services. /authorised individuals' who can carry out such functions. The GEN directions also lay out the broad principles for banking business and provide information about the Authority's supervisory powers, functions, and approach. The GEN Directions V 4.0 has amended the provisions inter-alia pertaining to Principles of Governance, Outsourcing. 7 The IFSCA Banking 10/07/2023 The COB directions are aimed at ensuring that Handbook: Conduct of IFSC Banking Units (IBUs) meet the minimum Business Directions- standards of conduct expected, particularly (CoB) V 5.0 with regard to the treatment of their clients, their dealings with counterparties and other market participants. The CoB 5.0 amends certain provisions related to definition and permitted activities. 126 1272023-24 Policies and Programmes for the following year Amendments under IFSCA Act, 2019 In order to create an overarching framework for IFSC in India and to bring futuristic changes in Establishing and Promoting GIFT IFSC as a hub for dispute resolution IFSCA Act, 2019 the Department of Economic Affairs has constituted a committee on May 23, 2023, for drafting amendments to the IFSCA Act, 2019. In view of this, the IFSCA has examined the IFSCA In the Union Budget 2022-23, Hon'ble Finance Minister announced setting up of an International Act & other relevant Acts and proposed amendments inter-alia in relation to dispute resolution Arbitration Centre (IAC) in GIFT City for timely settlement of disputes under international mechanism in IFSC, Ancillary Services, Variable Capital Companies, and enforcement powers for jurisprudence. newly notified financial products and financial services, etc. The proposed amendments are being In order to establish and to operationalise the IAC at GIFT IFSC a robust team of experts in the field pursued by IFSCA. of International Commercial Arbitration and Alternate Dispute Resolution is pre-requisite. Accordingly, IFSCA had constituted an “Expert Committee on drafting Institutional Arbitral Rules for Introduction of IFSCA (Informal Guidance) Scheme, 2024 International Arbitration Centre (IAC) at GIFT IFSC and matters incidental thereto” (IAC Committee) As the financial sector operates within a highly regulated environment characterized by various on May 25, 2023. laws, regulations, and guidelines aimed at safeguarding investors' interests, ensuring market The committee inter-alia includes the following broad terms of reference: integrity, and maintaining financial stability. In this regard IFSCA is envisaging to issue interpretative letters, no-action letters, and informal guidance to provide clarity, guidance, to i. To suggest and guide in preparing a roadmap for making GIFT-IAC a hub for alternative dispute financial institutions. These regulatory instruments play a crucial role in clarifying regulatory resolution of international financial and commercial disputes. requirements, resolving interpretative ambiguities, and facilitating compliance efforts within the ii. To suggest regulatory design, legal framework including regulations, and procedures of the financial industry. proposed dispute resolution centre in relation to: Review of IFSCA Regulations a. Institutional framework for the legal and administrative structure of the proposed GIFT- As per the Regulation 7 of the IFSCA (Procedure for making Regulations) Regulations, 2022, the IAC and the roles and responsibilities of its Governing Body. Authority (IFSCA) shall review each regulations every three years, keeping in view the factors b. Institutional rules for arbitration, mediation, and other hybrid mechanisms of alternative specified under the said regulation. Accordingly, a holistic examination of relevant regulations dispute resolution, such as mediation-arbitration, arbitration-mediation-arbitration, which have completed three years are being undertaken. In respect of some new areas, IFSCA has neutral evaluation, etc. in the past issued the regulatory framework in the form of circular/ guidelines/ notifications etc. In view of this, IFSCA is in contemplating to evaluate such circulars to convert them into Regulations c. Institutional framework for online dispute resolution, third-party funding in alternate after gaining sufficient experience. dispute resolution proceedings and technology-related services existing in major established dispute resolution centres. Programs envisioned The report of the Expert Committee is expected to be submitted in the month of May/ June 2024. IFSCA will strive to implement the recommendations of the committee by seeking requisite legal enablers and other policy changes and the same would be taken up with Department of Economic Affairs. In order to popularize and promote GIFT IFSC as a seat of international commercial arbitration and mediation, the following initiatives are envisaged to be undertaken: (i) A global conclave to be organized highlighting the unique benefits of GIFT IFSC as a seat for dispute resolution; (ii) Collaboration with agencies, major global arbitration and mediation centres and practitioners; and (iii) Outreach programs to be conducted in order to onshore the offshores disputes and practitioners. 128 1292023-24 Policies and Programmes for the following year Amendments under IFSCA Act, 2019 In order to create an overarching framework for IFSC in India and to bring futuristic changes in Establishing and Promoting GIFT IFSC as a hub for dispute resolution IFSCA Act, 2019 the Department of Economic Affairs has constituted a committee on May 23, 2023, for drafting amendments to the IFSCA Act, 2019. In view of this, the IFSCA has examined the IFSCA In the Union Budget 2022-23, Hon'ble Finance Minister announced setting up of an International Act & other relevant Acts and proposed amendments inter-alia in relation to dispute resolution Arbitration Centre (IAC) in GIFT City for timely settlement of disputes under international mechanism in IFSC, Ancillary Services, Variable Capital Companies, and enforcement powers for jurisprudence. newly notified financial products and financial services, etc. The proposed amendments are being In order to establish and to operationalise the IAC at GIFT IFSC a robust team of experts in the field pursued by IFSCA. of International Commercial Arbitration and Alternate Dispute Resolution is pre-requisite. Accordingly, IFSCA had constituted an “Expert Committee on drafting Institutional Arbitral Rules for Introduction of IFSCA (Informal Guidance) Scheme, 2024 International Arbitration Centre (IAC) at GIFT IFSC and matters incidental thereto” (IAC Committee) As the financial sector operates within a highly regulated environment characterized by various on May 25, 2023. laws, regulations, and guidelines aimed at safeguarding investors' interests, ensuring market The committee inter-alia includes the following broad terms of reference: integrity, and maintaining financial stability. In this regard IFSCA is envisaging to issue interpretative letters, no-action letters, and informal guidance to provide clarity, guidance, to i. To suggest and guide in preparing a roadmap for making GIFT-IAC a hub for alternative dispute financial institutions. These regulatory instruments play a crucial role in clarifying regulatory resolution of international financial and commercial disputes. requirements, resolving interpretative ambiguities, and facilitating compliance efforts within the ii. To suggest regulatory design, legal framework including regulations, and procedures of the financial industry. proposed dispute resolution centre in relation to: Review of IFSCA Regulations a. Institutional framework for the legal and administrative structure of the proposed GIFT- As per the Regulation 7 of the IFSCA (Procedure for making Regulations) Regulations, 2022, the IAC and the roles and responsibilities of its Governing Body. Authority (IFSCA) shall review each regulations every three years, keeping in view the factors b. Institutional rules for arbitration, mediation, and other hybrid mechanisms of alternative specified under the said regulation. Accordingly, a holistic examination of relevant regulations dispute resolution, such as mediation-arbitration, arbitration-mediation-arbitration, which have completed three years are being undertaken. In respect of some new areas, IFSCA has neutral evaluation, etc. in the past issued the regulatory framework in the form of circular/ guidelines/ notifications etc. In view of this, IFSCA is in contemplating to evaluate such circulars to convert them into Regulations c. Institutional framework for online dispute resolution, third-party funding in alternate after gaining sufficient experience. dispute resolution proceedings and technology-related services existing in major established dispute resolution centres. Programs envisioned The report of the Expert Committee is expected to be submitted in the month of May/ June 2024. IFSCA will strive to implement the recommendations of the committee by seeking requisite legal enablers and other policy changes and the same would be taken up with Department of Economic Affairs. In order to popularize and promote GIFT IFSC as a seat of international commercial arbitration and mediation, the following initiatives are envisaged to be undertaken: (i) A global conclave to be organized highlighting the unique benefits of GIFT IFSC as a seat for dispute resolution; (ii) Collaboration with agencies, major global arbitration and mediation centres and practitioners; and (iii) Outreach programs to be conducted in order to onshore the offshores disputes and practitioners. 128 1292023-24 PERFORMANCE ASSESSMENT (iii) Member from PFRDA (Shri Ananta Gopal Das, ED) (iv) Shri M V Nair, Independent Expert Section 17(3) of the IFSCA Act, 2019 provides the mechanism to review the performance of IFSCA. Major Recommendations of the Committee Section 28(2)(d) of the IFSCA Act, 2019 provides IFSCA the powers to make regulations in respect of Performance Review Committee. Accordingly, IFSCA (Performance Review Committee) (i) Starting its journey about three years ago, the IFSCA has made significant strides in Regulations, 2022 (“PRC Regulations”), were notified on March 23, 2022, providing the framework developing and regulating GIFT IFSC. More importantly, IFSCA has adopted certain best for constitution, scope, information sharing and reporting relating to functioning of Performance practices of governance in a short span from the commencement of its operations. The Review Committee (“PRC”). regulations specifying the procedure for making regulations and conducting board meetings are commendable illustrations of these practices. On top of it, the Authority has embarked on The following three committees were formed to review the functioning of the Authority: a review of its performance, which is a rarity in the Indian regulatory landscape. The Committee on Compliance Committee takes notice of these practices and applauds the IFSCA for embedding them into the organisational DNA at such an early stage. The implementation of the suggestions made The scope of the committee is to review whether the authority has adhered to the provisions of the by the Committee may put the Authority on the path of a model regulator. applicable laws while exercising powers or performing functions under the Act. (ii) Regulatory clarity and predictability are key to ease of doing business. A business entity most often wishes to do business, and not be a victim of legal ambiguity. In its sincerity to comply Members of the Committee with the law, it may need clarity and comfort before it executes a transaction. Regulations may (i) Shri Bahram Vakil, Independent Expert (Chairperson of the Committee) enable a stakeholder to seek clarification, interpretation, or 'no action letter' from the (ii) Member from RBI (Shri Saurav Sinha, ED) Authority in case of doubt. The Authority may establish an institutional mechanism that (iii) Member from SEBI (Shri Pramod Rao, ED) provides informal guidance on the provisions of the law as well as 'no action letter' in case of (iv) Shri J Ranganayakulu, Independent Expert Major proposed transactions. Recommendations of the Committee Committee on Risk Management (i) IFSCA is largely in compliance with the provisions of IFSCA Act, 2019 and IFSCA (Procedure for making Regulations) Regulations, 2021 while issuing the regulations notified in FY 2022- The scope of the committee is to review whether the Authority is managing risks to its functioning 23. IFSCA has followed a consultative approach for framing of the regulations in general. in a reasonable manner. (ii) Benchmarking with global best practices: While IFSCA has made references to the global best Members of the Committee practices in the consultation paper and expert committee reports in respect of some of the (i) Member from IRDAI (Shri P. K. Arora, Whole Time Member) (Chairperson of the Committee) regulations notified in FY 2022-23, this approach may be followed in respect of all the (ii) Member from Department of Economic Affairs (Ms. Surbhi Jain, Joint Secretary) regulations notified by IFSCA, wherever necessary. The benchmarking with global standards (iii) Shri Sriram Balasubramanyam, Independent Expert and best practices of other jurisdictions will contribute towards a better policy formation (iv) Shri G Srinivasan, Independent Expert aimed at serving several objectives such as promoting ease of doing business, managing Major Recommendations of the Committee systemic risk and robust regulatory regimes. In this regard, the Committee also suggests that concept papers at an early stage of policy making may also be floated, wherever desirable. (i) In the initial period, the focus should be on creating an appropriate risk management framework at IFSCA for its functioning as a regulator, rather than conducting a Committee on Transparency and Best Practices of comprehensive review. Governance (ii) By enhancing its regulatory framework, IFSCA can adapt to emerging risks and market developments, foster international cooperation, and ensure effective enforcement. The scope of the committee is to review whether the regulations made by the Authority to give Implementing risk-based supervision allows IFSCA to allocate regulatory resources effect to the provisions of the Act promote transparency and best practices of governance. efficiently, prioritize supervisory efforts, and stay ahead of potential risks. Furthermore, investments in technology and cybersecurity enable IFSCA to improve operational efficiency, Members of the Committee data management, and protection against cyber threats. (i) Dr. M. S. Sahoo, Independent Expert (Chairperson of the Committee) Recommendations of the Committees along with Action Taken Report have been submitted to (ii) Member from Department of financial Services (Shri Pankj Sharma, Joint Secretary) central Government. 132 1332023-24 PERFORMANCE ASSESSMENT (iii) Member from PFRDA (Shri Ananta Gopal Das, ED) (iv) Shri M V Nair, Independent Expert Section 17(3) of the IFSCA Act, 2019 provides the mechanism to review the performance of IFSCA. Major Recommendations of the Committee Section 28(2)(d) of the IFSCA Act, 2019 provides IFSCA the powers to make regulations in respect of Performance Review Committee. Accordingly, IFSCA (Performance Review Committee) (i) Starting its journey about three years ago, the IFSCA has made significant strides in Regulations, 2022 (“PRC Regulations”), were notified on March 23, 2022, providing the framework developing and regulating GIFT IFSC. More importantly, IFSCA has adopted certain best for constitution, scope, information sharing and reporting relating to functioning of Performance practices of governance in a short span from the commencement of its operations. The Review Committee (“PRC”). regulations specifying the procedure for making regulations and conducting board meetings are commendable illustrations of these practices. On top of it, the Authority has embarked on The following three committees were formed to review the functioning of the Authority: a review of its performance, which is a rarity in the Indian regulatory landscape. The Committee on Compliance Committee takes notice of these practices and applauds the IFSCA for embedding them into the organisational DNA at such an early stage. The implementation of the suggestions made The scope of the committee is to review whether the authority has adhered to the provisions of the by the Committee may put the Authority on the path of a model regulator. applicable laws while exercising powers or performing functions under the Act. (ii) Regulatory clarity and predictability are key to ease of doing business. A business entity most often wishes to do business, and not be a victim of legal ambiguity. In its sincerity to comply Members of the Committee with the law, it may need clarity and comfort before it executes a transaction. Regulations may (i) Shri Bahram Vakil, Independent Expert (Chairperson of the Committee) enable a stakeholder to seek clarification, interpretation, or 'no action letter' from the (ii) Member from RBI (Shri Saurav Sinha, ED) Authority in case of doubt. The Authority may establish an institutional mechanism that (iii) Member from SEBI (Shri Pramod Rao, ED) provides informal guidance on the provisions of the law as well as 'no action letter' in case of (iv) Shri J Ranganayakulu, Independent Expert Major proposed transactions. Recommendations of the Committee Committee on Risk Management (i) IFSCA is largely in compliance with the provisions of IFSCA Act, 2019 and IFSCA (Procedure for making Regulations) Regulations, 2021 while issuing the regulations notified in FY 2022- The scope of the committee is to review whether the Authority is managing risks to its functioning 23. IFSCA has followed a consultative approach for framing of the regulations in general. in a reasonable manner. (ii) Benchmarking with global best practices: While IFSCA has made references to the global best Members of the Committee practices in the consultation paper and expert committee reports in respect of some of the (i) Member from IRDAI (Shri P. K. Arora, Whole Time Member) (Chairperson of the Committee) regulations notified in FY 2022-23, this approach may be followed in respect of all the (ii) Member from Department of Economic Affairs (Ms. Surbhi Jain, Joint Secretary) regulations notified by IFSCA, wherever necessary. The benchmarking with global standards (iii) Shri Sriram Balasubramanyam, Independent Expert and best practices of other jurisdictions will contribute towards a better policy formation (iv) Shri G Srinivasan, Independent Expert aimed at serving several objectives such as promoting ease of doing business, managing Major Recommendations of the Committee systemic risk and robust regulatory regimes. In this regard, the Committee also suggests that concept papers at an early stage of policy making may also be floated, wherever desirable. (i) In the initial period, the focus should be on creating an appropriate risk management framework at IFSCA for its functioning as a regulator, rather than conducting a Committee on Transparency and Best Practices of comprehensive review. Governance (ii) By enhancing its regulatory framework, IFSCA can adapt to emerging risks and market developments, foster international cooperation, and ensure effective enforcement. The scope of the committee is to review whether the regulations made by the Authority to give Implementing risk-based supervision allows IFSCA to allocate regulatory resources effect to the provisions of the Act promote transparency and best practices of governance. efficiently, prioritize supervisory efforts, and stay ahead of potential risks. Furthermore, investments in technology and cybersecurity enable IFSCA to improve operational efficiency, Members of the Committee data management, and protection against cyber threats. (i) Dr. M. S. Sahoo, Independent Expert (Chairperson of the Committee) Recommendations of the Committees along with Action Taken Report have been submitted to (ii) Member from Department of financial Services (Shri Pankj Sharma, Joint Secretary) central Government. 132 133SOURCE OF FUNDS AND MAJOR AREAS OF EXPENDITURE (FY 2023-24) Table 33 : Sources of Funds for FY 2023-24 Annual Fees 2,499.46 Application Fees 254.40 Broker Turnover Fees: Capital Markets 1,232.24 Turnover based fee from Insurance Offices 20.06 Listing Fees 2.49 Registration Fees 2,192.96 Other Fees (Processing fee etc.) 64.77 Government Grants 6,463.54 Interest income 695.33 Fees from Miscellaneous Services 1.16 Other Incomes 54.31 Total 13,480.72 Table 34 : Break Up of Government Grants for FY 2023-24 Grants in Aid for Salary 3,663.54 Grants in Aid for General 1,300.00 Grants in Aid for creation of Capital 1,500.00 Total 6,463.54 Table 35 : Major Areas of Expenditure for FY 2023-24 Establishment Expenses 3,782.15 Administrative Expenses 1,974.58 Purchase of Fixed Assets (including payment made for 3,919.06 Headquarter Land/Building) Security Deposit for C-DAC 1.00 Total 9,676.79 136SOURCE OF FUNDS AND MAJOR AREAS OF EXPENDITURE (FY 2023-24) Table 33 : Sources of Funds for FY 2023-24 Annual Fees 2,499.46 Application Fees 254.40 Broker Turnover Fees: Capital Markets 1,232.24 Turnover based fee from Insurance Offices 20.06 Listing Fees 2.49 Registration Fees 2,192.96 Other Fees (Processing fee etc.) 64.77 Government Grants 6,463.54 Interest income 695.33 Fees from Miscellaneous Services 1.16 Other Incomes 54.31 Total 13,480.72 Table 34 : Break Up of Government Grants for FY 2023-24 Grants in Aid for Salary 3,663.54 Grants in Aid for General 1,300.00 Grants in Aid for creation of Capital 1,500.00 Total 6,463.54 Table 35 : Major Areas of Expenditure for FY 2023-24 Establishment Expenses 3,782.15 Administrative Expenses 1,974.58 Purchase of Fixed Assets (including payment made for 3,919.06 Headquarter Land/Building) Security Deposit for C-DAC 1.00 Total 9,676.79 1362023-24 ORGANISATIONAL MATTERS Administration and HR Authority Structure Treasury Finance and Accounts General Rajbhasha Table 36 : Authority Structure as on March 31, 2024 Administration Project Management Unit (International Events, Conferences and Summits) Information Technology Banking Supervision Technology Banking Supervision FinTech Finance Company Supervision Legal Policy Finance Company Regulation Banking Payment and Settlement Policy and Legal Legal Affairs Banking Regulations Affairs Investor Education and Protection Corporate Finance – Equity, Hybrid and related products SEZ Corporate Finance – Debt and Sustainable Finance Regulatory Cooperation Market Infrastructure Institutions – Regulation and Supervision Risk Based Supervision Cell Regulatory Policy Capital Markets Investment Funds - I and New Products & Services and Regulatory Affairs SupTech Investment Funds - II Anti Money Laundering and CFT Supervision of Intermediaries Global-In-House Centre and Ancillary Services Insurance Insurance & Pension Cyber Security Pension Market Development Market Regulation Development of Financial Markets Authority Meetings Foreign University Table 37 : IFSC Authority Meetings held in FY 2023-24 Economic Policy and Analysis Development International Affairs Meeting Outreach and Communication Ease of Doing Business Cell 1 15 Authority meeting June 26, 2023 2 16 Authority meeting September 27, 2023 3 17 Authority meeting December 29, 2023 4 18 Authority meeting March 27, 2024 138 1392023-24 ORGANISATIONAL MATTERS Administration and HR Authority Structure Treasury Finance and Accounts General Rajbhasha Table 36 : Authority Structure as on March 31, 2024 Administration Project Management Unit (International Events, Conferences and Summits) Information Technology Banking Supervision Technology Banking Supervision FinTech Finance Company Supervision Legal Policy Finance Company Regulation Banking Payment and Settlement Policy and Legal Legal Affairs Banking Regulations Affairs Investor Education and Protection Corporate Finance – Equity, Hybrid and related products SEZ Corporate Finance – Debt and Sustainable Finance Regulatory Cooperation Market Infrastructure Institutions – Regulation and Supervision Risk Based Supervision Cell Regulatory Policy Capital Markets Investment Funds - I and New Products & Services and Regulatory Affairs SupTech Investment Funds - II Anti Money Laundering and CFT Supervision of Intermediaries Global-In-House Centre and Ancillary Services Insurance Insurance & Pension Cyber Security Pension Market Development Market Regulation Development of Financial Markets Authority Meetings Foreign University Table 37 : IFSC Authority Meetings held in FY 2023-24 Economic Policy and Analysis Development International Affairs Meeting Outreach and Communication Ease of Doing Business Cell 1 15 Authority meeting June 26, 2023 2 16 Authority meeting September 27, 2023 3 17 Authority meeting December 29, 2023 4 18 Authority meeting March 27, 2024 138 1392023-24 Human Resources Table 39 : Consultants at IFSCA as on March 31, 2024 Table 38 : Sanctioned and Actual strength of employees Sanctioned strength Actual strength Position as on 31.03.2024 as on 31.03.2024 1 Sr. Consultants 3 Full time basis Executive Director 6 3 2 Consultants Grade1/Grade2 9 Full time basis Chief General Manager 12 5 3 Young Professionals 12 Full time basis 4 Adviser 1 Part-time basis General Manager 16 15 Deputy General Manager 20 6 Right to Information Assistant General Manager 27 6 Table 40 : Status of RTI applications during FY 2023-24 Total number of RTI requests replied Manager 35 15 Initial Requests Action Transferred Returned Pending Assistant Manager 47 33 Received to Be Information Rejected To Other To Requests Taken Provided Public Applicant Authority Executive Assistant/ 232 0 219 2 1 0 10 Senior Executive Assistant/ Executive Superintendent 27 0 IFSCA Headquarters Building Project Multi-Tasking Staff Grade A/ The headquarters building of IFSCA (“IFSCA Tower”) is planned to have a built-up area of over Grade B/ Grade C* 13 3 3,00,000 square feet spread across 26 floors with best-in-class modern amenities and a magnificent panoramic view. In keeping with the Smart City concept of GIFT City, the IFSCA Tower TOTAL 203 86 has been designed to be a platinum rated green building with a highly efficient and sustainable structure. It is believed that as grand as this building is in its architecture, it will also create *The requirements are being partially met through outsourcing unlimited opportunities to make India an economic superpower. Being a unified financial sector regulatory Authority, IFSCA requires the expertise and skill set of As on March 31, 2024, the construction work for fourteen floors has been completed and schematic Young Professionals/Consultants/Sr. Consultants in the fields of Capital Market, Banking, floor layouts for the interior fit-outs package have been finalized. Finishing & Mechanical, Insurance, Bullion, Funds Management, FinTech, etc. In accordance with the guidelines for Electrical, Plumbing, and Fire Protection (MEPF) work has also started simultaneously, and the engagement of consultants on a contractual basis, the Authority has engaged the consultants as building is expected to be fully functional by March 2025. Once completed, IFSCA Tower will mentioned in the table below: emerge as a monumental edifice in GIFT City and symbolize the dreams and aspirations of a New and Aatma Nirbhar Bharat. IFSCA Celebrated Swachhata Pakhwada – “Swachhata Hi Seva - 2023” IFSCA organised a Walkathon as part of 'Swachhata Pakhwada - Swachhata Hi Seva' on September 29, 2023. As part of the Pakhwada, IFSCA employees actively participated in the Walkathon and reaffirmed their commitment to cleanliness, sanitation, and waste management. Affirming their commitment to cleanliness, IFSCA employees took a Swachhta Pledge administered by IFSCA Chairperson. 140 1412023-24 Human Resources Table 39 : Consultants at IFSCA as on March 31, 2024 Table 38 : Sanctioned and Actual strength of employees Sanctioned strength Actual strength Position as on 31.03.2024 as on 31.03.2024 1 Sr. Consultants 3 Full time basis Executive Director 6 3 2 Consultants Grade1/Grade2 9 Full time basis Chief General Manager 12 5 3 Young Professionals 12 Full time basis 4 Adviser 1 Part-time basis General Manager 16 15 Deputy General Manager 20 6 Right to Information Assistant General Manager 27 6 Table 40 : Status of RTI applications during FY 2023-24 Total number of RTI requests replied Manager 35 15 Initial Requests Action Transferred Returned Pending Assistant Manager 47 33 Received to Be Information Rejected To Other To Requests Taken Provided Public Applicant Authority Executive Assistant/ 232 0 219 2 1 0 10 Senior Executive Assistant/ Executive Superintendent 27 0 IFSCA Headquarters Building Project Multi-Tasking Staff Grade A/ The headquarters building of IFSCA (“IFSCA Tower”) is planned to have a built-up area of over Grade B/ Grade C* 13 3 3,00,000 square feet spread across 26 floors with best-in-class modern amenities and a magnificent panoramic view. In keeping with the Smart City concept of GIFT City, the IFSCA Tower TOTAL 203 86 has been designed to be a platinum rated green building with a highly efficient and sustainable structure. It is believed that as grand as this building is in its architecture, it will also create *The requirements are being partially met through outsourcing unlimited opportunities to make India an economic superpower. Being a unified financial sector regulatory Authority, IFSCA requires the expertise and skill set of As on March 31, 2024, the construction work for fourteen floors has been completed and schematic Young Professionals/Consultants/Sr. Consultants in the fields of Capital Market, Banking, floor layouts for the interior fit-outs package have been finalized. Finishing & Mechanical, Insurance, Bullion, Funds Management, FinTech, etc. In accordance with the guidelines for Electrical, Plumbing, and Fire Protection (MEPF) work has also started simultaneously, and the engagement of consultants on a contractual basis, the Authority has engaged the consultants as building is expected to be fully functional by March 2025. Once completed, IFSCA Tower will mentioned in the table below: emerge as a monumental edifice in GIFT City and symbolize the dreams and aspirations of a New and Aatma Nirbhar Bharat. IFSCA Celebrated Swachhata Pakhwada – “Swachhata Hi Seva - 2023” IFSCA organised a Walkathon as part of 'Swachhata Pakhwada - Swachhata Hi Seva' on September 29, 2023. As part of the Pakhwada, IFSCA employees actively participated in the Walkathon and reaffirmed their commitment to cleanliness, sanitation, and waste management. Affirming their commitment to cleanliness, IFSCA employees took a Swachhta Pledge administered by IFSCA Chairperson. 140 1412023-24 Image 37 : IFSCA Employees taking Swachhta Pledge administered by Chairperson, IFSCA Image 39 : Cleanliness drive at PDPU Bridge Gift City As part of 'Swachhata Pakhwada - Swachhata Hi Seva (SHS) 2023' by IFSCA employees IFSCA Celebrated International Yoga Day 2023 The International Day of Yoga (IDY), which is celebrated across the world annually on June 21 since 2015, following its inception in the United Nations General Assembly in 2014, was celebrated at IFSCA (HQ) on June 21, 2023, with the adoption of Common Yoga Protocol, a 1-hour sequence of Yoga exercises designed by Yoga exponents in the country. The theme of IDY 2023 was “Yoga is a way of life”. Yoga being a physical, mental, and spiritual practice with ancient origins in India, employees of IFSCA practiced the Common Yoga Protocol, reaffirming their commitment to physical and mental wellbeing. Vigilance awareness week 2023 As part of the Vigilance Awareness Week from October 30, 2023, to November 05, 2023, IFSCA Officers took Vigilance Pledge affirming their commitment towards integrity and ethics in public life. A spirited debate and discussion on topics “Best Practice in Governance to Prevent Corruption” Image 38 : Walkathon as part of 'Swachhata Pakhwada - Swachhata Hi Seva' and “Corruption is a Cancerous Limb” took place at the IFSCA on November 02, 2023, as a part of the Vigilance Awareness week marked by active participation from IFSCA employees. As part of 'Swachhata Pakhwada - Swachhata Hi Seva (SHS) 2023', from September 15, 2023, to October 02, 2023, IFSCA employees pledged their commitment to avoid single use plastic in their daily routine IFSCA organised a cleanliness drive at PDPU Bridge Gift City. The drive concluded with segregation of collected waste into recyclable & non-recyclable categories. 142 1432023-24 Image 37 : IFSCA Employees taking Swachhta Pledge administered by Chairperson, IFSCA Image 39 : Cleanliness drive at PDPU Bridge Gift City As part of 'Swachhata Pakhwada - Swachhata Hi Seva (SHS) 2023' by IFSCA employees IFSCA Celebrated International Yoga Day 2023 The International Day of Yoga (IDY), which is celebrated across the world annually on June 21 since 2015, following its inception in the United Nations General Assembly in 2014, was celebrated at IFSCA (HQ) on June 21, 2023, with the adoption of Common Yoga Protocol, a 1-hour sequence of Yoga exercises designed by Yoga exponents in the country. The theme of IDY 2023 was “Yoga is a way of life”. Yoga being a physical, mental, and spiritual practice with ancient origins in India, employees of IFSCA practiced the Common Yoga Protocol, reaffirming their commitment to physical and mental wellbeing. Vigilance awareness week 2023 As part of the Vigilance Awareness Week from October 30, 2023, to November 05, 2023, IFSCA Officers took Vigilance Pledge affirming their commitment towards integrity and ethics in public life. A spirited debate and discussion on topics “Best Practice in Governance to Prevent Corruption” Image 38 : Walkathon as part of 'Swachhata Pakhwada - Swachhata Hi Seva' and “Corruption is a Cancerous Limb” took place at the IFSCA on November 02, 2023, as a part of the Vigilance Awareness week marked by active participation from IFSCA employees. As part of 'Swachhata Pakhwada - Swachhata Hi Seva (SHS) 2023', from September 15, 2023, to October 02, 2023, IFSCA employees pledged their commitment to avoid single use plastic in their daily routine IFSCA organised a cleanliness drive at PDPU Bridge Gift City. The drive concluded with segregation of collected waste into recyclable & non-recyclable categories. 142 1432023-24 conduct. Strategies to foster a progressive work environment and cultivate talent were deliberated upon. 'Building a Global Brand for IFSCA' constituted the fourth session, where participants discussed strategies to enhance IFSCA's global visibility and credibility as a premier international financial centre. Emphasis was laid on effective branding, marketing initiatives, and strategic partnerships to bolster IFSCA's reputation on the world stage. The fifth session, 'Regulatory Innovation Benchmarking to World's Best Jurisdictions,' centered on benchmarking IFSCA's regulatory framework against glob al best practices to ensure regulatory agility, efficiency, and investor confidence. Insights were gleaned from global regulatory frameworks to inform IFSCA's ongoing regulatory innovation endeavours. Lastly, the sixth session, 'IFSCA for Viksit Bharat @ 2047,' envisioned IFSCA's role in driving India's economic growth and development aspirations, aligning with the vision for a prosperous and resilient India by 2047. Participants deliberated on strategies to leverage IFSCA's strengths in fostering economic inclusivity, innovation, and sustainable development across sectors. The Chintan Shivir served as a platform for robust deliberations, fostering collaboration, and charting a Image 40 : IFSCA Officers taking Vigilance Pledge as part of Vigilance Awareness week roadmap for IFSCA's continued evolution as a unified regulator. IFSCA organised a two-days Chintan Shivir A two-days Chintan Shivir was organised on March 12-13, 2024, to deliberate and achieve the vision of Hon'ble PM that “IFSCA will not only become an enabler but will also support innovation and will also act as a catalyst for growth opportunities.” The Chairperson, IFSCA, Shri K Rajaraman, spearheaded the 'Chintan Shivir' held at Kevadia, Gujarat, aimed at fostering strategic insights and outlining future trajectories for IFSCA's role as a regulator. The event drew the active participation of IFSCA officers and employees, marking a pivotal milestone in charting the organization's course forward. On first day, a tour to SoU and other state-of-the art infrastructure and facilities at Kevadia was organised. On the second day, the Chintan Shivir unfolded across six dynamic sessions, each delving into critical themes shaping the future of international finance and IFSCA's strategic positioning therein. The first session, themed 'Future of Finance/Web 3.0/AI/Quantum Computing,' delved into the transformative potential of emerging technologies and their implications for financial services in the digital age. Discussions were made on the integration of AI, blockchain, and quantum computing in reshaping financial infrastructure and services from a regulatory perspective. In the second session, 'IFSCA as a Global Climate Finance Hub,' participants explored avenues for IFSCA to spearhead sustainable finance initiatives, aligning with global efforts to combat climate change. Discussions revolved around fostering green investments and incentivizing climate- resilient financial products. The third session focused on 'Culture Building in Organization,' emphasizing the significance of nurturing a cohesive organizational culture conducive to innovation, collaboration, and ethical Image 41 : Visit of Statue of Unity, as part of Chintan Shivir 2024 144 1452023-24 conduct. Strategies to foster a progressive work environment and cultivate talent were deliberated upon. 'Building a Global Brand for IFSCA' constituted the fourth session, where participants discussed strategies to enhance IFSCA's global visibility and credibility as a premier international financial centre. Emphasis was laid on effective branding, marketing initiatives, and strategic partnerships to bolster IFSCA's reputation on the world stage. The fifth session, 'Regulatory Innovation Benchmarking to World's Best Jurisdictions,' centered on benchmarking IFSCA's regulatory framework against glob al best practices to ensure regulatory agility, efficiency, and investor confidence. Insights were gleaned from global regulatory frameworks to inform IFSCA's ongoing regulatory innovation endeavours. Lastly, the sixth session, 'IFSCA for Viksit Bharat @ 2047,' envisioned IFSCA's role in driving India's economic growth and development aspirations, aligning with the vision for a prosperous and resilient India by 2047. Participants deliberated on strategies to leverage IFSCA's strengths in fostering economic inclusivity, innovation, and sustainable development across sectors. The Chintan Shivir served as a platform for robust deliberations, fostering collaboration, and charting a Image 40 : IFSCA Officers taking Vigilance Pledge as part of Vigilance Awareness week roadmap for IFSCA's continued evolution as a unified regulator. IFSCA organised a two-days Chintan Shivir A two-days Chintan Shivir was organised on March 12-13, 2024, to deliberate and achieve the vision of Hon'ble PM that “IFSCA will not only become an enabler but will also support innovation and will also act as a catalyst for growth opportunities.” The Chairperson, IFSCA, Shri K Rajaraman, spearheaded the 'Chintan Shivir' held at Kevadia, Gujarat, aimed at fostering strategic insights and outlining future trajectories for IFSCA's role as a regulator. The event drew the active participation of IFSCA officers and employees, marking a pivotal milestone in charting the organization's course forward. On first day, a tour to SoU and other state-of-the art infrastructure and facilities at Kevadia was organised. On the second day, the Chintan Shivir unfolded across six dynamic sessions, each delving into critical themes shaping the future of international finance and IFSCA's strategic positioning therein. The first session, themed 'Future of Finance/Web 3.0/AI/Quantum Computing,' delved into the transformative potential of emerging technologies and their implications for financial services in the digital age. Discussions were made on the integration of AI, blockchain, and quantum computing in reshaping financial infrastructure and services from a regulatory perspective. In the second session, 'IFSCA as a Global Climate Finance Hub,' participants explored avenues for IFSCA to spearhead sustainable finance initiatives, aligning with global efforts to combat climate change. Discussions revolved around fostering green investments and incentivizing climate- resilient financial products. The third session focused on 'Culture Building in Organization,' emphasizing the significance of nurturing a cohesive organizational culture conducive to innovation, collaboration, and ethical Image 41 : Visit of Statue of Unity, as part of Chintan Shivir 2024 144 1452023-24 IFSCA celebrated 77 Independence Day The International Financial Services Centres Authority (IFSCA) celebrated India's 77 Independence Day at GIFT IFSC in Gandhinagar. The celebration commenced with a flag-hoisting ceremony, followed by an inspiring speech from Chairperson, IFSCA, highlighting India's economic milestones and future aspirations. The event fostered a profound sense of pride and patriotism among the participants, reflecting on India's journey to independence and its subsequent progress. Image 42 : City tour, as part of Chintan Shivir 2024 IFSCA celebrated 75 Republic Day IFSCA celebrated India's 75 Republic Day at GIFT City in Gandhinagar with great enthusiasm and patriotism. Employees of IFSCA gathered to honor the occasion, reflecting on India's journey of 75 years since becoming a republic. The celebrations included a flag hoisting ceremony, cultural programs, and speeches. The event highlighted the nation's journey and achievements since becoming a republic, reflecting on the values and principles that have guided India's progress. Image 44 : Flag hoisting on 77 Independence Day Celebration Image 43 : Flag hoisting ceremony on 75 Republic Day 146 1472023-24 IFSCA celebrated 77 Independence Day The International Financial Services Centres Authority (IFSCA) celebrated India's 77 Independence Day at GIFT IFSC in Gandhinagar. The celebration commenced with a flag-hoisting ceremony, followed by an inspiring speech from Chairperson, IFSCA, highlighting India's economic milestones and future aspirations. The event fostered a profound sense of pride and patriotism among the participants, reflecting on India's journey to independence and its subsequent progress. Image 42 : City tour, as part of Chintan Shivir 2024 IFSCA celebrated 75 Republic Day IFSCA celebrated India's 75 Republic Day at GIFT City in Gandhinagar with great enthusiasm and patriotism. Employees of IFSCA gathered to honor the occasion, reflecting on India's journey of 75 years since becoming a republic. The celebrations included a flag hoisting ceremony, cultural programs, and speeches. The event highlighted the nation's journey and achievements since becoming a republic, reflecting on the values and principles that have guided India's progress. Image 44 : Flag hoisting on 77 Independence Day Celebration Image 43 : Flag hoisting ceremony on 75 Republic Day 146 1472023-24 Internal Complaints Committee: PoSH Act An Internal Complaints Committee (ICC) was constituted on July 27, 2021, by the Competent Authority in compliance with Section 4 of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (PoSH Act). The members of ICC include an External Member, along with Internal Members and the senior-most lady officer as the Presiding Officer. During the Financial Year 2023-24, the ICC has not received any complaints. The ICC had four meetings, one in each quarter, during the year. Awareness programmes were also conducted for sensitizing IFSCA employees regarding the PoSH Act and the mechanisms available for resolution of any complaints. A session was also conducted by the External Member on the PoSH Act for the new employees. 1482023-24 Internal Complaints Committee: PoSH Act An Internal Complaints Committee (ICC) was constituted on July 27, 2021, by the Competent Authority in compliance with Section 4 of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (PoSH Act). The members of ICC include an External Member, along with Internal Members and the senior-most lady officer as the Presiding Officer. During the Financial Year 2023-24, the ICC has not received any complaints. The ICC had four meetings, one in each quarter, during the year. Awareness programmes were also conducted for sensitizing IFSCA employees regarding the PoSH Act and the mechanisms available for resolution of any complaints. A session was also conducted by the External Member on the PoSH Act for the new employees. 1482023-242023-24