GIFT City Newsletter | April 2026

The GIFT International Financial Services Centre ("GIFT IFSC"), established in Gandhinagar, Gujarat, is India's first international financial services centre with the intent of catering to global MNCs and financial institutions in alignment with international standards of business. To ensure that the utmost benefits can be provided, the entire zone has been equipped with world-class infrastructure akin to global standards. This newsletter navigates the journey of GIFT IFSC and the International Financial Services Centres Authority ("IFSCA") set up under the International Financial Services Centres IFSCA Act 2019.

IFSCA, as a unified regulator, is also headquartered at GIFT IFSC and is committed to providing a sound and well-structured regulatory environment by providing a single window clearance system. The IFSCA has been able to achieve this through the unification of the powers previously held by four separate regulators: the Reserve Bank of India ("RBI"), the Securities and Exchange Board of India ("SEBI"), the Insurance Regulatory and Development Authority of India ("IRDAI"), and Pension Fund Regulatory and Development Authority of India ("PFRDAI").

We are providing transactional updates, including a bird's eye view of legal and regulatory updates related to the GIFT IFSC.

Annual Reporting Norms Specified for International Branch Campuses in GIFT IFSC

April 30, 2026: IFSCA specified the annual reporting norms for International Branch Campuses of Foreign Universities established in the IFSC. IBCs must submit their operational information in an editable Excel workbook within 30 days from the closure of the Academic Year, which ends on March 31 every year. Information detailing 'Graduation Outcomes' must be submitted within 30 days from the date degrees, diplomas, or certificates are formally issued to the students.

DLL Analysis: This circular is essentially IFSCA laying the groundwork for data-driven supervision of the newly formed education in GIFT City, ensuring educational institutions maintain transparency regarding their outcomes. It mandates strict 30-day reporting windows and separating operational data from graduation outcomes, the IFSCA ensures that foreign universities operating within the IFSC are held accountable for both their operational integrity and actual student success.

Source: IFSCA GIFT website [Circular File No.: IFSCA-BDev0FUNI/4/2026-BD dated April 30, 2026]

Key Approvals at the 28th IFSCA Authority Meeting

April 24, 2026: The IFSCA held its 28th Authority meeting on April 17, 2026, delivering several critical approvals designed to deepen capital markets and expand the aviation financing ecosystem. First, the Authority approved comprehensive regulatory frameworks for Preferential Issues, Qualified Institutions Placements (QIPs), and Rights Issues under the IFSCA (Listing) Regulations, 2024, providing listed companies with streamlined, fast-track mechanisms to raise additional capital.

The Authority also approved draft amendments to the IFSCA (TechFin and Ancillary Services) Regulations, 2025, and the IFSCA (Finance Company) Regulations, 2021, to enable the structuring of Special Purpose Vehicles (SPVs) entirely within GIFT IFSC. This framework allows Trust and Company Service Providers (TCSPs) to be formally registered to manage these SPVs, facilitating end-to-end structuring of aircraft leasing transactions domestically. The Authority noted the rapid growth of the aircraft leasing ecosystem, highlighting that more than 370 aviation assets have been leased from the IFSC as of March 31, 2026.

DLL Analysis: These approvals represent a major structural advancement for the IFSC. By operationalizing the capital-raising avenues under the Listing Regulations, IFSCA provides much-needed liquidity mechanisms for listed companies to scale operations. Furthermore, the SPV and TCSP amendments are highly strategic; they directly address the preference of global financial institutions to finance aircraft through SPV structures. By allowing these to be domiciled in GIFT City, India can retain financing activity domestically, reduce the outflow of lease rentals and structuring fees to offshore jurisdictions, ensure rigorous AML/KYC compliance through regulated TCSPs, and generate high-skilled employment in legal and fiduciary services.

Source: IFSCA website [Press Release dated April 24, 2026]

Amendment to the Framework for Ship Leasing

April 22, 2026: IFSCA amended the “Framework for Ship Leasing” dated August 16, 2022, by omitting the Explanation contained in clause 3.D.(ii) of that framework. This omission is a consequence of the inclusion of “management of physical assets” in the Third Schedule of the IFSCA (TechFin and Ancillary Services) Regulations, 2025, which details services not permitted for TechFin and Ancillary Service Providers.

DLL Analysis: This targeted amendment harmonizes the ship leasing framework with the newly introduced TechFin and Ancillary Services regulations, removing conflicting definitions.

Source: IFSCA GIFT website [Circular F. No. IFSCA-FCR0SL/25/2025-Banking/2026-27/01 dated April 22, 2026]

Framework for Preferential Issues and QIPs Introduced

April 22, 2026: IFSCA specified the framework for listed entities to raise capital through preferential issues and Qualified Institutions Placements (QIPs) under the Listing Regulations. This framework applies strictly to entities whose specified securities are listed solely on the recognized stock exchanges in the IFSC, explicitly excluding issuers with secondary listings. Key highlights include:

• Eligibility and Payment Conditions: Issuers are ineligible to raise capital if they have outstanding dues payable to the Authority, stock exchanges, or depositories, unless under appeal. Also, an issue cannot be made to any person who has sold the issuer’s equity shares within the 30 trading days preceding the relevant date. All allotted equity shares must be fully paid up at the time of allotment.
• Tenure of Convertible Securities: The tenure is restricted to a maximum of 18 months for preferential issues and 60 months for QIPs. For warrants, at least 25% of the consideration must be paid upfront on the date of allotment, with the remainder paid upon exercise.
• Preferential Issue Requirements: Issuers must mandate comprehensive disclosures, including the identity of Ultimate Beneficial Owners (UBOs) and the post-issue shareholding pattern. Pricing must be determined by an independent valuation report prepared by a registered valuer. Securities allotted to promoters are subject to a 6-month lock-up period, and the allotment must be completed within 30 days of the resolution.
• QIP Requirements: Issuers are mandated to appoint at least one IFSCA-registered investment banker to act as the lead manager. The issue relies on specific placement documents, and the allotment process must be completed within one year from the date of passing the special resolution.

DLL Analysis: IFSCA provides clear, structured liquidity mechanisms for listed GIFT City companies to scale their operations. The framework balances this flexibility with strict structural safeguards, such as mandatory UBO disclosures, registered third-party valuations, and a 6-month promoter lock-up. This ensures efficient capital formation while maintaining transparency and protecting the jurisdiction from opaque transactions.

Source: IFSCA GIFT website [Circular F. No. IFSCA-PLNP/16/2024-Capital Markets dated April 22, 2026]

Regulatory Framework for Rights Issues Established

April 22, 2026: IFSCA laid out the comprehensive framework for Rights Issues by entities whose specified securities are listed solely on recognized stock exchanges in the IFSC. A rights issue must be kept open for subscription for a minimum of seven days. Issuers must ensure that all of their existing partly paid-up equity shares are either fully paid-up or forfeited before making the issue. The regulatory framework outlines explicit procedures for both on-market and off-market renunciation of rights entitlements.

DLL Analysis: This framework protects existing shareholders by providing structured avenues to prevent dilution, thereby aligning the IFSC's primary market processes with established global equity market standards.

Source: IFSCA GIFT website [Circular F. No. IFSCA-PLNP/16/2024-Capital Markets dated April 22, 2026]

Cyber Security and Resilience Guidelines Issued for MIIs

April 20, 2026: IFSCA issued prescriptive Cyber Security and Cyber Resilience guidelines for Market Infrastructure Institutions (MIIs), establishing a rigorous framework tailored specifically for stock exchanges, clearing corporations, depositories, and the bullion exchange. The guidelines mandate the appointment of a dedicated Chief Information Security Officer (CISO) who must report directly to the MD/CEO. MIIs are required to establish a 24x7x365 Cyber Security Operation Centre (C-SOC) and implement specialized training programs to transition to Post Quantum Cryptography (PQC) standards. Any cyber-attacks or breaches must be reported to IFSCA and CERT-In within 6 hours of detection. Key highlights include:

• Board-Level Governance: MIIs must have a Board-approved policy with a dedicated Chief Information Security Officer (CISO) reporting directly to the MD/CEO.
• Post-Quantum Readiness: MIIs must conduct annual Cryptographic Risk Assessments and establish roadmaps for adopting Post-Quantum Cryptography (PQC) standards (e.g., NIST FIPS 203, 204, and 205) to future-proof critical systems.
• 24x7 Operations: Implementation of a round-the-clock Cyber Security Operations Centre (C-SOC) with contingent capabilities at Disaster Recovery sites, utilizing User and Entity Behavior Analytics (UEBA).
• Incident Reporting & Certification: Cyber incidents must be reported to IFSCA and CERT-In within 6 hours. Furthermore, all MIIs are required to obtain ISO 27001 certification within two years.

DLL Analysis: MIIs form the central system of the IFSC's capital markets. Elevating their cybersecurity compliance from a baseline standard to a highly prescriptive, globally aligned framework significantly mitigates systemic risk. The forward-looking mandate forcing MIIs to prepare for Post-Quantum Cryptography (PQC) is particularly notable, demonstrating IFSCA's proactive approach to shielding the jurisdiction's core financial infrastructure against next-generation computational threats.

Source: IFSCA GIFT website [Circular IFSCA-CSD/MSC/2/2026-DCS dated April 20, 2026] & [Press Release dated April 20, 2026]

MoU Between IFSCA and Financial Services Commission of Korea

April 20, 2026: IFSCA and the Financial Services Commission (FSC) of Korea signed a Memorandum of Understanding (MoU) at the Korea-India Financial Cooperation Forum in New Delhi. The agreement is designed to strengthen regulatory cooperation and advance the financial services ecosystems in both jurisdictions. The MoU facilitates the exchange of information, best practices, and knowledge regarding the application of emerging technologies and financial innovations.

DLL Analysis: This bilateral agreement is a significant step in GIFT IFSC's global integration strategy. By establishing a structured dialogue and cross-border cooperation mechanism with a technologically advanced jurisdiction like South Korea, IFSCA is positioning itself to rapidly adopt global best practices in fintech, regulatory technology, and cross-border financial supervision.

Source: IFSCA website [Revised Press Release dated April 20, 2026]

First Foreign Family Investment Fund Registration

April 20, 2026: IFSCA granted its first-ever registration to a foreign Family Office (Family Investment Fund) under the IFSCA (Fund Management) Regulations, 2025. This landmark approval was granted to Poornam Asset Management (IFSC) Pvt Ltd, which will act as the IFSC-based fund management platform for a UK-based family office structure. The entity is designed to target ultra-high-net-worth (UHNI) capital, led by a London-based fund manager. This registration enables the efficient management and deployment of family wealth across global jurisdictions through robust, well-governed fund structures established within the IFSC. Furthermore, it highlights IFSCA's commitment to creating a flexible and globally competitive regulatory ecosystem for foreign family offices, allowing them to leverage offshore-style benefits such as potential tax holidays and liberalized foreign exchange frameworks within India's borders.

DLL Analysis: This registration serves as a crucial proof-of-concept for the IFSC's private wealth management regime. It signals to global ultra-high-net-worth individuals and family offices that GIFT IFSC offers a viable, well-governed, and fully operational alternative to traditional offshore wealth hubs. It sets a regulatory precedent that is likely to attract further inward migration of private capital seeking efficient structuring.

Source: IFSCA website [Press Release dated April 20, 2026] & Moneycontrol [April 20, 2026]

April 18, 2026: In its first such enforcement action, IFSCA revoked a broker-dealer license in GIFT IFSC as part of a crackdown on non-compliant intermediaries. Inspections revealed a severe lack of operational substance: the entity was engaged in unauthorized IT and data services rather than its licensed financial activities, had no active clients, and was not operating from its registered premises.

DLL Analysis: This enforcement underscores IFSCA’s strict "substance over form" mandate. By penalizing the lack of genuine operational presence, the regulator sets a strong cautionary precedent. It signals zero tolerance for the misuse of IFSC registrations, reinforcing that entities must maintain actual infrastructure, personnel, and core business activities within GIFT City.

Source: Moneycontrol [April 18, 2026]

Segregation of Fiduciary Roles for Fund Management Entities

April 10, 2026: IFSCA issued a clarification regarding the governance and oversight of schemes, mandating a strict segregation of duties for fiduciaries. An FME is strictly prohibited from appointing an entity acting as a fiduciary to a scheme to simultaneously provide fund administration, valuation, audit, lending, or financing services to that same scheme, either directly or through its associate. For schemes that are already taken on record or filed, FMEs must take the necessary steps to comply with this segregation by September 30, 2026.

DLL Analysis: This circular enforces a high standard of corporate governance by eliminating conflicts of interest. Ensuring total independence between a scheme's fiduciary and its service providers bolsters investor confidence.

Source: GIFT IFSCA website [Circular F. No. IFSCA-IF-10PR/7/2024-Capital Markets/10042026 dated April 10, 2026].

Prior Approval Mandated for PSPs in Rupee Drawing Arrangements

April 10, 2026: IFSCA clarified that Payment Service Providers (PSPs) must obtain prior approval from the Authority before participating in the Rupee Drawing Arrangement (RDA) scheme as non-resident Exchange Houses. PSPs requesting this permission must submit a comprehensive overview of the frameworks and processes they have instituted to ensure compliance with IFSCA's AML, CFT, and KYC Guidelines for the proposed RDA transactions.

DLL Analysis: By demanding explicit prior approval and a robust demonstration of AML/CFT frameworks, IFSCA ensures that cross-border rupee drawing arrangements maintain the highest standards of financial integrity.

Source: GIFT IFSCA website [Circular e.F.No. IFSCA-FMPP0BR/3/2023-Banking 2026-27/01 dated April 10, 2026].

IFSCA Revises Reporting Norms for Capital Market Intermediaries

April 08, 2026: IFSCA updated the quarterly reporting formats for CMIs to integrate newly introduced entity categories, such as Global Access Providers, Credit Rating Agencies, ESG Ratings and Data Products Providers, and Research Entities. CMIs registered as Broker Dealers, Clearing Members, and Depository Participants are now required to submit their quarterly reports to their respective Market Infrastructure Institutions (MIIs), which will then provide the information to IFSCA. Other CMIs must submit their reports in an editable Excel file directly to IFSCA within 21 calendar days from the end of the quarter.

DLL Analysis: This update decentralises the reporting process for certain CMIs through MIIs, significantly reducing administrative bottlenecks and enhancing supervisory efficiency. IFSCA empowers MIIs to act as first-level supervisors, significantly reducing administrative bottlenecks and allowing the Authority to focus on systemic risks by decentralizing the reporting process and delegating front-line data collection to Market Infrastructure Institutions (MIIs) for high-volume trading entities. Separating the rigorous AML/CFT compliance reporting into a half-yearly cycle reflects a pragmatic approach that balances strict financial crime oversight with the ease of doing business.

Source: GIFT IFSCA website [Circular F.No.1/IFSCA/CMI Supervision/2023-24 dated April 08, 2026].

Consultation Paper on Mapping of SAC and Foreign Currency Expense Reporting for IFSC Units

April 08, 2026: IFSCA has released a consultation paper to introduce a standardized approach for capturing value creation in foreign currency from and within the IFSC ecosystem. The proposal focuses on standardizing Service Accounting Codes (SAC) for revenue reporting at the invoice level in the Service Exports Reporting Form (SERF) and introducing a foreign currency expense reporting field in the Monthly Performance Report (MPR) via the SEZ Online system. Key highlights include:

• Standardized SAC Code Framework: The paper proposes a sector-wise list of recommended SAC codes aligned with the existing Goods and Services Tax (GST) framework to ensure the consistent classification of financial services and income streams.
• Foreign Currency Expense Reporting: To capture aggregate monthly expenses incurred in permitted foreign currencies, a new reporting field titled "Expenses (paid in foreign currencies, converted into USD)" is proposed to be added to the MPR format.
• Estimation of Net Value Creation: These reporting updates will enable IFSCA to estimate the net foreign-currency value creation (FCVC) by calculating the difference between gross foreign currency receipts (FCGR) and total foreign currency expenses (FCEXP).
• Scope and Exclusions: The framework is strictly for reporting and analytical purposes; it explicitly does not propose the creation of new SAC codes, nor does it alter any tax treatments, regulatory obligations, or liability determinations.

DLL Analysis: The consultation paper addresses the existing inconsistencies in SAC code usage across different IFSC units, which currently limit the comparability and analytical usefulness of the reported data. By mandating the capture of aggregate foreign currency expenses alongside gross revenues, IFSCA will gain precise visibility into the actual net value generated within the IFSC. This framework ensures better data quality across sectors without imposing new tax or regulatory burdens, thereby balancing robust regulatory monitoring with ease of compliance.

Source: GIFT IFSCA website [Consultation Paper dated April 08, 2026].

April 06, 2026: The International Financial Services Centres Authority (Pension Fund) Regulations, 2026 were officially published in the Gazette of India on April 2, 2026, following their notification by the Authority on March 30, 2026. These regulations establish a comprehensive framework for the registration, regulation, and supervision of Pension Funds operating within the IFSC. The key highlights include:

• Eligibility and Governance: Applicants seeking registration must maintain a minimum net worth of USD 1 million at all times. The entity's Board must consist of at least four directors, of which at least one-half must be independent directors. Furthermore, the fund must appoint a minimum of two Key Managerial Personnel responsible for fund and risk management, alongside a dedicated Compliance Officer.
• Investment Choices and Asset Allocation: Pension funds may offer both an "Active choice" (where subscribers select their asset allocation) and an "Auto choice" or life cycle fund (where allocation automatically shifts to conservative assets as the subscriber approaches retirement). Permissible asset classes are broad, including listed equities, fixed-income instruments, Alternative Investment Funds (AIFs), and frequently traded commodities.
• Geographic Diversification: Investments in India can go up to 100% of the Scheme's Assets Under Management (AUM). For global market exposure outside India, investments in any single country are capped at 20% of the AUM, with a notable exception for the United States, where the limit is increased to 50%.
• Withdrawal and Superannuation Rules: Pre-retirement partial withdrawals are permitted after a five-year lock-in period for specific life events (like higher education, marriage, or critical illness), capped at 75% of the subscriber's contribution. Upon superannuation (age 60), subscribers are mandated to opt for a Systematic Withdrawal Plan (SWP) utilising a minimum of 20% of the accumulated corpus, with the remainder payable as a lump sum.
• Healthcare Benefit Option: Funds can offer a healthcare benefit option allowing subscribers to allocate up to 10% of their total contributions into a dedicated "Healthcare Sub-Account" to cover planned hospital expenses or medical emergencies.
• Risk Management Architecture: Pension funds are required to adopt an enterprise-wide risk management framework that incorporates a 'three lines of defense' model (risk ownership, risk control, and independent assurance). Regular stress testing and scenario analyses are also strictly mandated to ensure portfolio resilience.

DLL Analysis: These regulations establish a secure, institutional-grade framework for long-term retirement savings, aligning GIFT City with top global pension hubs. By balancing investment flexibility-such as up to 100% foreign equity and AIF exposure-with strict geographic concentration limits and robust 'three lines of defense' risk governance, IFSCA ensures the jurisdiction will attract well-capitalized global fund managers to domicile innovative and diverse retirement products.

Source: GIFT IFSCA website [Notification dated April 6, 2026].

GIFT IFSC Sees Rapid Rise in Insurance and Reinsurance Activity

April 03, 2026: India's initiative to bring global risk underwriting onshore is accelerating at GIFT City, with the IFSC witnessing sharp growth in insurance and reinsurance operations. Key highlights include:

• Surge in Premium Volumes: Official data shows premium volumes at GIFT City have surged more than 11-fold in five years, rising from $102 million in 2020 to over $1.2 billion in 2025.
• Influx of Global Players: Around 24 insurance entities are currently operating from the hub. In FY26 alone, several major global players commenced operations, including Allianz, Generali, Starr International Insurance, Abu Dhabi National Insurance Company (ADNIC), Qatar Re, Singapore Re, Doha Re, and Lloyd's of London, joining domestic firms like HDFC Life Re, Max Life, and Niva Bupa.
• Sector-Specific Expansion: Much of this expansion is driven by non-life insurance and reinsurance segments-such as trade credit, marine, and aviation-which are closely linked to cross-border trade and infrastructure financing.

DLL Analysis: The exponential growth in premium volumes and the influx of tier-one global reinsurers highlight GIFT IFSC's successful transition into a mature international underwriting hub. By offering regulatory clarity and an enabling framework, the jurisdiction is effectively reversing the historic offshoring of Indian risk. Furthermore, the robust mix of domestic insurers, global carriers, and intermediaries (like Marsh and JB Boda) proves that GIFT City is establishing itself not just as a hub for India-linked risk but as a strategic gateway for regional and global markets.

Source: The Times of India [April 03, 2026]

IFSCA Amends Circular on Appointment and Change of KMPs by FMEs

April 01, 2026: IFSCA amended its earlier circular dated February 20, 2025, which governed the "Appointment and Change of Key Managerial Personnel by a Fund Management Entity". Paragraph 4 of the aforementioned KMP Circular has been omitted with immediate effect. All other provisions and conditions specified in the original KMP Circular remain in full effect.

DLL Analysis: By omitting this specific paragraph, IFSCA is refining its regulatory stance on KMP appointments, removing a specific clause to streamline compliance and governance protocols for Fund Management Entities operating in the IFSC.

Source: GIFT IFSCA website [Circular IFSCA/13/2026-Capital Markets/1 dated April 01, 2026].

IFSCA Mandates Professional Certification for KMPs and Employees of FMEs and CMIs

April 01-02, 2026: IFSCA issued circulars specifying mandatory certification courses for Key Managerial Personnel (KMPs) and core employees of Fund Management Entities (FMEs) and Capital Market Intermediaries (CMIs). The Institute of Company Secretaries of India offers the courses. For FMEs, the course is titled "Regulatory Framework for Fund Management in IFSC: AIFs and Retail Schemes". For CMIs, the course is titled "Regulatory Framework for Capital Market Intermediaries in IFSC". These certifications must be completed on or before September 30, 2026. Employees involved in non-operational or support services, as well as broader ecosystem entities such as Trustees and Fund Administrators, are encouraged to pursue the certifications to promote higher standards of operational excellence.

DLL Analysis: This institutionalizes professional competence within the IFSC. By mandating specialized certification, IFSCA ensures that core operations are managed by personnel well-versed in the specific regulatory frameworks of the jurisdiction, thereby strengthening investor trust.

Source: GIFT IFSCA website [Circular IFSCA/13/2026-Capital Markets/1 dated April 01, 2026] & [Circular F. No. IFSCA-PLNP/80/2024-Capital Markets dated April 02, 2026].

Co-authored by Harshul Sharma, Associate

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