India’s first IFSC at GIFT CITY a major game changer for the financial services sector in India: Niranjan Hiranandani

MUMBAI/ AHMEDABAD, 2016: Indian corporate entities have expanded business operations out of India by going global, which in turn has led to increased requirement for services and finance related product s in markets located in other countries.

The Ahmedabad – Gandhinagar urban conglomeration in Gujarat fits the requirements of the perfect location for a ‘one stop shop’ solution for financial aspects needed for development of the nation’s BFSI sector, especially given that operations of Indian BFSIs have reached global levels. India’s first and only International Financial Services Centre (IFSC) is located at this urban conglomeration, the Gujarat International Finance Tec-City (GIFT) City.

Signature’ by the Hiranandani Group has been conceived as a unique commercial real estate offering in the IFSC,” said Niranjan Hiranandani, MD, Hiranandani Communities. With work proceeding speedily, ‘Signature’ seems all set to offer work spaces to the BFSI sector well in time for the formal inauguration of the IFSC during the next Vibrant Gujarat Summit which is expected to be held in end-2016.

The IFSC is seen as a major game changer for the financial services sector in India. Major tax incentives announced in the last Union Budget have made the IFSC a globally competitive player and more BFSI players are taking a positive stance when it comes to the new global financial hub,

The tax incentives include lower minimum alternate tax (MAT) and waiver of dividend distribution tax (DDT), securities transaction tax (STT), exemption from commodities transaction tax (STT) to units establishing their units in the IFSC. “These incentives have come at an opportune time, enquiries from tentative buyers of work spaces in‘Signature’ have increased in weeks following the Budget Speech by Finance Minister Arun Jaitley,” added Niranjan Hiranandani.

The after-effect of the positives in the Budget have been enhanced enquiries, and Hiranandani Communities is in final stages of talks with leading financial institutions from India’s BFSI sector, to facilitate their picking up space in the future-ready commercial complex, ‘Signature’ – which enjoys the ‘first mover’ advantage at the IFSC. “Given India’s continued economic growth, the financial sector will grow increasingly larger, with a prospect of 10 – 11 million jobs by 2020,” said Niranjan Hiranandani.

For the banking sector, the route-map is opening an IFSC Banking Unit (IBU) at the IFSC. An IBU allows an Indian bank to deliver a complete range of products to its clients with foreign currency funding requirements. It can offer products such as external commercial borrowings (ECBs) to its customers, an area where it had limited capabilities hitherto. 

The IBU will enable a bank meet the funding requirements of overseas entities which may be joint ventures or subsidiaries of its domestic clients or part of the value chain of its existing customers,

Three banks have started operations in the International Financial Services Centre (IFSC). These are: Yes Bank, Federal Bank and ICICI Bank. Kotak Mahindra Bank Ltd became the fourth bank to open its IBU at the IFSC on 03 May 2016. 

We have welcomed Kotak Mahindra Bank and other illustrious financial institutions, who have picked up space in ‘Signature’,” said Niranjan Hiranandani. “I am glad to announce that this future-ready Commercial Complex is on track for timely possession in end-2016. Financial Institutions will find it advantageous to have their presence within the IFSC, as it will help them service foreign currency needs of their corporate clients.” said Niranjan Hiranandani. 

With over $250 million worth of business transactions done at IFSC in the past six months, the IFSC is attracting interest from the BFSI sector in India, especially from banks, insurance companies and other financial services players who want to tap the global markets. The IFSC is now targeting a share of the NIFTY derivative trades which are executed through the Singapore Stock Exchange.

Following the banks, the IFSC is looking forward to insurance companies starting operations shortly. 

Besides the four banks which have operational IBUs at the IFSC, State Bank of India, Punjab National Bank, Corporation Bank, IDBI Bank and IndusInd Bank are scheduled to begin operating in the next few months. 

The IFSC is an SEZ which has plans for both, residential as well as commercial real estate, and is touted to emerge as an commercial location of choice for the BFSI sector. In the first phase, over 14 million square feet of built up area has been allowed in the IFSC’s SEZ and Non-SEZ area for development of office towers, residential apartments and social facilities. The second phase envisages a built-up area of 1.32 million square feet.

Apart from the banks already mentioned, Bank of India, Syndicate Bank, Gujarat State Co-operative Bank and Janalakshmi Bank have begun normal banking operations outside the SEZ.

 

Backgrounder:-

ABOUT THE IFSC: As part of Phase-I development, the IFSC is developing around 13 million square feet of BUA for commercial, residential and social uses. The IFSC has come up with 1.25 million sq. ft. of BUA for commercial and residential purposes in GIFT SEZ and non-SEZ areas.

Built on 886 acres of land, the IFSC is located on the National Highway 8, which is part of the Mumbai – Delhi road corridor. It also enjoys smooth connectivity to the SVP International Airport Ahmedabad; as also the Western Railway’s network which links Mumbai and New Delhi.

The IFSC is India’s first ever. With an integrated township consisting of both commercial and residential complexes, the IFSC boasts of infrastructural features which only global domains have.

ABOUT SIGNATURE: ‘Signature’ by the Hiranandani Group will play its role, by providing global infrastructure in a well-planned commercial complex to meet the requirements of Financial Institutions. Real estate development by the Hiranandani Group has always been a trendsetter when it comes to real estate which appreciates in value and offers growth opportunities on a global scale. It is not a mere coincidence that whenever brand Hiranandani has created commercial realty hubs, the location has ended up being a winner; be it the stupendous success of Hiranandani Gardens at Powai, Mumbai or Hiranandani Meadows and Hiranandani Estate in Thane: always, Brand Hiranandani has been the first to spot the potential of what were then, ‘new’ locations and new real estate models. In all of these, the Commercial Space – be it work spaces or offices or back-end hubs – have been the flag-bearers of commercial real estate growth in these success stories, something the Hiranandanis hope to replicate with ‘Signature’ in the IFSC.

BRAND HIRANANDANI: Real estate development by the Hiranandani Brand has always been a trendsetter when it comes to real estate which appreciates in value and offers growth opportunities on a global scale. It is not just a coincidence that whenever brand Hiranandani has created commercial realty hubs, the location has ended up being a winner; be it the stupendous success of Hiranandani Gardens at Powai in Mumbai or Hiranandani Meadows and Hiranandani Estate in Thane. Brand Hiranandani has been the first to spot the potential of what were then, ‘new’ locations and new real estate models. In all of these, the Commercial Space – be it work spaces or offices or back-end hubs – have been the flag-bearers of commercial real estate growth in these success stories, something the Hiranandanis hope to replicate with ‘Signature’ in the IFSC.

NIRANJAN HIRANANDANI: the driving force behind the ambitious dream project ‘Signature’ is Founder & MD, Hiranandani Group. His recent initiative is Hiranandani Communities. He is the Founder and First President (West), National Real Estate Development Council (NAREDCO), which works under the aegis of Ministry of Housing & Urban Poverty Alleviation, Government of India..

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