GIFT City Setup for a fund, FME or IFSC company.
GIFT City in Gandhinagar is India's International Financial Services Centre (IFSC), regulated by IFSCA. I help fund managers, family offices and businesses set up there - a fund management entity and its schemes, a family investment fund, or an IFSC company or unit - and coordinate counsel, the office developer and the IFSCA application from start to finish.
Four ways into GIFT City.
Fund management entity (FME)
The manager that runs funds from GIFT City. Under the IFSCA (Fund Management) Regulations, 2025 it registers as an Authorised FME, a Registered FME (Non-Retail) or a Registered FME (Retail), depending on the schemes and investors it will handle.
Fund schemes
Venture capital and restricted schemes for accredited or sophisticated investors and, for a Registered FME (Retail), retail schemes, ETFs, REITs and InvITs. Venture and non-retail restricted schemes start at a USD 3 million corpus.
Family investment fund
A GIFT City fund for one family's own money, with a corpus of USD 10 million to be reached within three years. Resident family members contribute within the LRS limit.
IFSC company or unit
A company, LLP or branch carrying on a permitted financial service in foreign currency - such as fund management, aircraft and ship leasing, treasury or capital-market services - and eligible for the section 80LA deduction on qualifying income.
SEBI AIF or GIFT City fund.
Where a fund should sit depends on where the investors are, which currency they invest in and where the money goes. The domestic route is covered on the AIF registration page.
| Factor | SEBI AIF (domestic) | GIFT City fund (IFSC) |
|---|---|---|
| Regulator | SEBI | IFSCA |
| Currency | Indian rupees | Foreign currency, usually US dollars |
| Minimum corpus | Rs 20 crore per scheme | USD 3 million for venture and non-retail restricted schemes |
| Typical investors | Mainly Indian investors | Overseas investors and NRIs; Indian residents within the LRS limit |
| FEMA status | A resident Indian fund | Treated as a person resident outside India |
| Typical portfolio | Mainly Indian companies and securities | India and overseas |
A rule of thumb, not advice for your fund: thresholds can change, and we confirm the current IFSCA and SEBI rules before you commit.
Setting up an FME and its first scheme.
Counsel drafts the fund documents; we design the structure, coordinate every party and run the IFSCA application.
- 01
Fit check
Who the investors are, which currency they hold, where the fund will invest and what each route costs to run - so you know GIFT City is the right home before money is spent.
- 02
Choose the FME category
Authorised, Registered (Non-Retail) or Registered (Retail), matched to the schemes you plan, the investors you will take and the net worth you can commit.
- 03
Entity, net worth and money route
Set up the FME entity, fund its net worth, and route the money correctly under FEMA, since an IFSC entity counts as a person resident outside India.
- 04
People and office
IFSCA expects a Principal Officer and a Compliance Officer based in GIFT City, fit-and-proper declarations, proof of net worth and a physical office in the IFSC. We line these up before filing.
- 05
IFSCA application
We prepare the application - business plan, ownership, key people and declarations - file it on the IFSCA single-window portal and handle the queries.
- 06
First scheme and launch
Scheme documents drafted by counsel and reviewed by us, the scheme filing, a foreign-currency bank account and the fund's service providers, then the first close.
- 07
Tax and running compliance
Section 80LA planning, transfer pricing for India-side services, and the yearly IFSCA, tax and FEMA filings on one calendar.
Setting up an IFSC company or unit.
For a business that will carry on a permitted financial service from GIFT City in foreign currency.
- 01
Activity, entity and promoters
Settle the permitted activity, the form - company, LLP or branch - and who the promoters are.
- 02
Office space
Get a letter of intent or allotment for office space from a GIFT City developer or co-developer.
- 03
Incorporation
Incorporate with the Registrar of Companies and take PAN and TAN.
- 04
IFSCA approval
Apply for IFSC unit approval and the activity licence on the IFSCA single-window portal; the approving committee may call you to a meeting.
- 05
Lease, GST and bank accounts
Once the letter of approval is in hand: sign the lease, register for GST and open the foreign-currency accounts.
- 06
Start of operations
Report the start of operations and begin the compliance calendar - IFSCA, income tax including section 80LA, and FEMA.
GIFT City setup questions.
What is a fund management entity (FME) in GIFT City?
It is the IFSCA-registered manager that launches and runs funds from GIFT City IFSC. Under the IFSCA (Fund Management) Regulations, 2025 it registers as Authorised, Registered (Non-Retail) or Registered (Retail), and that category decides which schemes and investors it can take.
What is the minimum corpus for a GIFT City fund?
USD 3 million for venture capital and non-retail restricted schemes, down from USD 5 million. A family investment fund needs USD 10 million within three years. Retail schemes have their own rules, and we confirm the current figure for your scheme before filing.
What is the GIFT City tax holiday under section 80LA?
An eligible IFSC unit can deduct 100% of its qualifying business income for 10 consecutive years out of 15. We confirm the exact window that applies to your unit and start year before you rely on it.
Can Indian residents invest in a GIFT City fund?
Yes. A resident individual can invest within the Liberalised Remittance Scheme - up to USD 250,000 per financial year, with TCS on remittances above Rs 10 lakh. Indian companies invest under the overseas investment rules.
Do we need people and an office in GIFT City?
Yes. IFSCA expects a Principal Officer and a Compliance Officer based in GIFT City and a physical office in the IFSC. A name-plate office is not enough, so we plan the people and the space before filing.
Should I set up a GIFT City fund or a domestic AIF?
Mostly overseas investors, a foreign-currency raise or investing outside India points to GIFT City. Mostly Indian investors investing in India points to a SEBI AIF. Some managers run both; the comparison above sets out the differences.
Can you guarantee IFSCA approval?
No. IFSCA decides every application, and nobody can promise the outcome or the timing. We prepare a complete file, line up the people and the office it expects, and answer its queries quickly.
- GIFT City Fund Management Entity (FME) Set-up: IFSCA Guide
- GIFT City Fund vs Domestic AIF: Which Structure to Choose
- Family Investment Fund in GIFT City: Single Family Office Guide
- GIFT City Company Set-up: IFSC Unit Steps and Tax Holiday
- Family Office Set-up in India: Structure, Cost and Governance
- AIF Category I vs II vs III: Which SEBI Category Fits Your Fund
- Vraj Changani - CA, Startup Advisor & IPO Consultant
Thinking about GIFT City? Test the fit first.
Tell us who the investors are, which currency they hold and where the money will go. We will tell you whether GIFT City, a domestic AIF or both fit, and what each takes to set up.
WhatsApp +91 88664 48967 - CA Vraj Changani, DRSPV & Associates, Mumbai.