GIFT City Global Investing: 5 Things You Must Know

Indian residents can now invest in global stocks, ETFs, and mutual funds through GIFT City without using their full LRS limit. Here is how it works and whether it makes sense for your portfolio.

Here's what happened: GIFT City in Gujarat is India's International Financial Services Centre, allowing residents to invest in foreign stocks, ETFs, and mutual funds with some tax and regulatory advantages.. Investments through GIFT City do not fully consume your annual LRS (Liberalised Remittance Scheme) limit of USD 250,000, making it distinct from directly buying foreign stocks.. Minimum investment thresholds start at around USD 5,000 for mutual funds, while Alternative Investment Funds (AIFs) require significantly higher tickets of USD 150,000 or more..

What you should do: Check whether your bank or broker offers a GIFT City investment account — HDFC Securities, ICICI Direct, and several fintechs have started onboarding retail investors.. Compare the TCS (Tax Collected at Source) implications: remittances above ₹7 lakh via LRS attract 20% TCS, but GIFT City routes may carry different treatment — verify with your CA.. Start small by exploring GIFT City-domiciled international mutual funds before committing to higher-ticket AIFs, especially if you have no prior global investing experience..

GIFT City investments are settled in USD, so rupee depreciation actually works in your favour — your returns in rupee terms get a natural boost when the rupee weakens.