GIFT City: Difference between revisions

The total area for the development of GIFT is 886 acres out of which the [[Special economic zone|SEZ]] (Special Economic Zone) constitutes 261 acres. The project area under development can hence be classified under the [[Special economic zone|SEZ]] area and the Non-SEZ area (also known as the Domestic Tariff area or the DTA).<ref name="Bloomberg 2022" />

GIFT City has dedicated Multi Services Special Economic Zone (SEZ) for international operations of various services sectors players. Also within the GIFT Multi Services SEZ, GIFT houses India's first International Financial Services Center (IFSC) approved by the Government of India.<ref name="Bloomberg 2022">{{cite news |last1=Rodrigues |first1=Jeanette |last2=Sircar |first2=Subhadip |title=India’s Free-Market Oasis Aims to Take On Singapore and Dubai |url=https://www.bloomberg.com/news/features/2022-11-29/which-city-will-be-next-singapore-or-dubai-new-india-finance-hub-has-big-plans |access-date=29 November 2022 |work=[[Bloomberg News]] |date=29 November 2022 |language=en}}</ref>

For the purpose of implementation of the SEZ, GIFT Company Limited has set up an SPV (Special Purpose Vehicle) (100% subsidiary of GIFTCL) namely GIFT SEZ Ltd, designated as the developer organization of the SEZ. GIFTCL has also set up 5 subsidiary companies for the implementation of specialized infrastructure including Power, Water, ICT (Information & Communication Technology), District Cooling and solid waste management.<ref name=":4" />

[[File:Shri Sudhir Mankad, Chairman, GIFT City, presenting key of GIFT City to the Prime Minister, Shri Narendra Modi, at the inauguration ceremony of the India International Exchange in GIFT City, Gandhinagar, Gujarat.jpg|thumb| [[Prime Minister of India|Prime Minister]] [[Narendra Modi]] in 2017 at the [[India International Exchange]] inauguration ceremony in GIFT City.<ref>{{cite news|title=PM Modi to inaugurate 16-storey international exchange in Gujarat to rival Singapore, Dubai |url=https://economictimes.indiatimes.com/markets/stocks/news/pm-modi-to-inaugurate-16-storey-international-exchange-in-gujarat-to-rival-singapore-dubai/articleshow/56420183.cms|accessdate=16 January 2017|agency=[[Indo-Asian News Service]]|publisher=India Times|date=9 January 2017}}</ref><ref>{{cite news|title=PM Narendra Modi launches India's first international stock exchange|url=https://www.indiatoday.in/education-today/gk-current-affairs/story/modi-launches-india-stock-exchange-gift-city-954720-2017-01-13|accessdate=16 January 2017|publisher=India Today|date=13 January 2017}}</ref>]]

India's first city-level [[district cooling]] system (DCS) is operational at GIFT City. The first phase of this DCS, with a capacity of 10,000 [[Ton of refrigeration]] has been in operation since April 2015; it is designed to reduce the operational cost and avoid the capital cost of implementing individual air conditioners in each building.<ref>{{Cite web |title=REHVA Journal 01/2018 - India’s First District Cooling System at GIFT City |url=https://www.rehva.eu/rehva-journal/chapter/indias-first-district-cooling-system-at-gift-city |access-date=2022-12-02 |website=REHVA |language=en}}</ref>

The city plans to collect its solid waste through [[Automated waste collection|Automated Waste Collection]] system through chute system where waste is sucked in pipes at a speed of 90km/hr. It is expected upon completion that the AWS will handle the waste of the entire district, which is expected to be over 400 tonnes per day generated from GIFT City’s 25,000 apartments, 100,000 residents and a working population of over 500,000. The site’s retail zone will also attract between 25,000-50,000 visitors each week.<ref>{{Cite web |last=Jan 30 |first=Premal Balan / TNN / |last2=2015 |last3=Ist |first3=02:32 |title=Smart waste management system at GIFT city {{!}} Ahmedabad News - Times of India |url=https://timesofindia.indiatimes.com/city/ahmedabad/smart-waste-management-system-at-gift-city/articleshow/46060472.cms |access-date=2022-12-02 |website=The Times of India |language=en}}</ref><ref>{{Cite web |title=GIFT gives waste the boot, integrates water and waste management {{!}} Smart Cities Council |url=https://www.smartcitiescouncil.com/article/gift-gives-waste-boot-integrates-water-and-waste-management |access-date=2022-12-02 |website=www.smartcitiescouncil.com}}</ref>Automated waste collection can be combined with biomass energy generation systems, so GIFT will burn waste to generate energy.<ref>{{Cite web |title=GIFT City: Interesting facts about the project |url=https://economictimes.indiatimes.com/infrastructure/gift-city-interesting-facts-about-the-project/slideshow/17992935.cms |access-date=2022-12-02 |website=The Economic Times}}</ref><ref>{{Cite web |title=India's 'smart city' offers lessons for waste removal innovation |url=https://www.wastedive.com/news/indias-smart-city-offers-lessons-for-waste-removal-innovation/392155/ |access-date=2022-12-02 |website=Waste Dive |language=en-US}}</ref>

The buildings will be prepared with IBMS that controls different capacities of the building. The IBMS will be associated to central command middle to supply interface between the client and the utility benefit supplier.<ref>{{Cite web |last=Kumar |first=Ashwin |date=2016-08-15 |title=Features Available in India's First Smart City |url=https://techstory.in/gift-smart-city/ |access-date=2022-12-02 |website=TechStory |language=en-US}}</ref>

GIFT uses advance of technology in form of unique IoT (Internet of Things) based to monitor and manage city Infrastructure.The city will have a central command and control system. The objectives are

The tenants will have get to to channeled gas for residential employments, maintaining a strategic distance from the customary barrel framework.<ref>{{Cite news |title=IOC to set up unit in GIFT City to help raise capital |work=The Economic Times |url=https://economictimes.indiatimes.com/industry/energy/oil-gas/ioc-floats-subsidiary-for-treasury-operations/articleshow/94535605.cms |access-date=2022-12-02}}</ref>

The city plans to collect its solid waste through Automated Waste Collection system through chute system where waste is sucked in pipes at a speed of 90km/hr. This will lead to minimum human intervention, minimum space requirement and a cleaner city. Waste is to be treated with plasma technology.<ref>{{Cite web |title=GIFT gives waste the boot, integrates water and waste management {{!}} Smart Cities Council |url=https://www.smartcitiescouncil.com/article/gift-gives-waste-boot-integrates-water-and-waste-management |access-date=2022-12-02 |website=www.smartcitiescouncil.com}}</ref><ref>{{Cite web |title=Water and Sewage Treatment Plant at Gift City {{!}} PDF {{!}} Sewage Treatment {{!}} Water Resources |url=https://www.scribd.com/document/370576811/Water-and-Sewage-Treatment-Plant-at-Gift-City |access-date=2022-12-02 |website=Scribd |language=en}}</ref>

The design vision of the city is to provide potable water in all taps of the city which would be available on demand. Water from the Narmada canal will be stored in an artificial reservoir called Samrudhdhi Sarovar(designed for 15 days drinking water storage) and then conveyed to water treatment plant and then distributed. Water pipeline trunk and secondary network will be configured as a loop system.<ref>{{Cite web |title=Wastewater Recycling, Sewage Treatment {{!}} Waterfront Development |url=https://www.giftgujarat.in/water |access-date=2022-12-02 |website=www.giftgujarat.in}}</ref>

The city aims to provide quality and uninterrupted power supply to its citizens by sourcing power from independent sources with dedicated transmission infrastructure and having emergency power arrangements for critical areas of power supply.<ref>{{Cite web |title=Power Distribution Companies {{!}} Electricity Distribution Company |url=https://www.giftgujarat.in/power |access-date=2022-12-02 |website=www.giftgujarat.in}}</ref>

The highlight of the city is the Dedicated Utility Service Corridor which is an underground tunnel spread across the city which contains all the utility lines. The utility lines of power distribution, potable water, wastewater, gas, chilled water, ICT fibres and solid waste chute will be channelled through this underground tunnel. This makes it easier to operate and maintain these utility services unlike the conventional practise of digging streets regularly for maintenance of utility line.<ref>{{Cite web |title=Utility Tunnel {{!}} Water Treatment Plant {{!}} Fire Detection System |url=https://www.giftgujarat.in/utility-tunnel |access-date=2022-12-02 |website=www.giftgujarat.in}}</ref><ref>{{Cite web |date=2022-05-28 |title=Land to be acquired for utility tunnel in GIFT City |url=https://www.deshgujarat.com/2022/05/28/land-to-be-acquired-for-utility-tunnel-in-gift-city/ |access-date=2022-12-02 |website=DeshGujarat |language=en-US}}</ref>

The city aims to provide fibre-optics infrastructure to each and every cabin in the city. It will also develop data centre to provide common ICT infrastructure services.<ref>{{Cite news |last=Darji |first=Himanshu |title=Tech firms keen to develop ICT infrastructure in GIFT |work=The Economic Times |url=https://economictimes.indiatimes.com/news/economy/infrastructure/tech-firms-keen-to-develop-ict-infrastructure-in-gift/articleshow/15211945.cms?from=mdr |access-date=2022-12-02}}</ref>

The city will provide integrated urban transport system with high modal split towards public transport. The inter-city features include transit nodes, pedestrian pathways, travellators and multi-level parking. The city will have Intelligent Transport System(ITES) which would give real-time information about traffic, public transportation and routes within the city.

The city will be connected to the neighbouring city of Gandhinagar and Ahmedabad by Bus Rapid Transit and Mass Rapid Transit (Metrorail).<ref>{{Cite web |title=Transport |url=https://www.giftgujarat.in/transit-development |url-status=live |website=Giftcity}}</ref><ref>{{Cite web |last=Bureau |first=BL Ahmedabad |date=2022-08-23 |title=Chartered Speed starts EV transport services in GIFT City |url=https://www.thehindubusinessline.com/companies/chartered-speed-starts-ev-transport-services-in-gift-city/article65801605.ece |access-date=2022-12-02 |website=www.thehindubusinessline.com |language=en}}</ref>

Gujarat Maritime Cluster represents a total maritime business ecosystem that offers a way for shipping businesses to operate anywhere in the world, from one world-class location.

It is conceived as a dedicated ecosystem of Ports, Maritime Shipping and Logistics services providers.

It will host an array of maritime, shipping industry players and service providers, along with relevant Government regulatory agencies, in Gujarat International Finance Tec-City (GIFT City), Gandhinagar – India’s first International Financial Services Centre.<ref>{{Cite web |last=Bureau |first=Our |date=2021-06-07 |title=India’s first International Maritime Cluster to come up at GIFT City |url=https://www.thehindubusinessline.com/news/national/indias-first-international-maritime-cluster-to-come-up-at-gift-city/article34751940.ece |access-date=2022-12-02 |website=www.thehindubusinessline.com |language=en}}</ref>

The Gujarat Maritime Board (GMB), has been trying to develop such a cluster through its subsidiary Gujarat Ports Infrastructure and Development Company Ltd (GPIDCL).

While the project was conceptualised back in 2007, it received in-principle approval from the state government in 2015.<ref>{{Cite web |date=2021-01-21 |title=Gujarat Maritime Cluster - JournalsOfIndia |url=https://journalsofindia.com/gujarat-maritime-cluster/ |access-date=2022-12-02 |language=en-US}}</ref>

This will be the first centre of its kind in the country that will manage arbitration and mediation proceedings with disputes related to the maritime and shipping sector. The GIMAC will be part of a maritime cluster that the Gujarat Maritime Board (GMB) is setting up in '''GIFT City at Gandhinagar'''.<ref>{{Cite web |title=Gujarat International Maritime Arbitration Centre (GIMAC) |url=https://gmu.edu.in/about-gimac/ |access-date=2022-12-02 |website=Gujarat Maritime University |language=en-US}}</ref><ref>{{Cite web |last=Arora |first=Sumit |date=2021-07-09 |title=India’s first maritime arbitration centre to be set up in Gandhinagar |url=https://currentaffairs.adda247.com/indias-first-maritime-arbitration-centre-to-be-set-up-in-gandhinagar/ |access-date=2022-12-02 |website=adda247 |language=en-IN}}</ref>

** This will be the '''first centre of its kind''' in the '''country''' that will '''manage arbitration and mediation proceedings''' with '''disputes''' related to the '''maritime and shipping sector.'''

** The GIMAC will be part of a '''maritime cluster''' that the '''Gujarat Maritime Board (GMB)''' is setting up in GIFT City at Gandhinagar.<ref>{{Cite web |title=The Gujarat International Maritime Arbitration Centre (GIMAC) |url=https://gimac.in/#:~:text=This%20will%20be%20the%20first,in%20GIFT%20City%20at%20Gandhinagar. |access-date=2022-12-02 |website=gimac.in}}</ref>

** '''India’s Focus on Arbitration:''' Recently, the '''Arbitration and Conciliation (Amendment) Act, 2021''' was notified, considered as the landmark step towards making India as the hub of International Commercial Arbitration.

** There are over '''35 arbitral institutions in India,''' however, none focus exclusively on the '''disputes related to the maritime sector.'''

*** With the state continuing to witness a '''rapid extension in maritime activities''' and inching closer to becoming a '''global maritime''' '''hub''' with the implementation of '''Gujarat Maritime Cluster project,''' a strong growing and recurring demand is being generated for a specialized facility for maritime arbitration services.

** The idea is to create a '''world-class arbitration centre''' focused on maritime and shipping disputes that can help '''resolve commercial and financial conflicts''' between entities having '''operations in India.'''

*** The arbitration '''involving Indian players''' is now heard at the '''Singapore Arbitration Centre.'''

*** '''Globally, London''' is the preferred centre for arbitration for the maritime and shipping sector.<ref>{{Cite web |title=Gujarat International Maritime Arbitration Centre (GIMAC) |url=https://www.drishtiias.com/daily-updates/daily-news-analysis/gujarat-international-maritime-arbitration-centre-gimac |access-date=2022-12-02 |website=Drishti IAS |language=en}}</ref>

** Facilitate '''faster dispute resolution.'''

** Enhance the attractiveness of '''GIFT Special Economic Zone (SEZ)''' among the International Maritime Community.

** Increase the '''ease of doing business.'''

** '''Reduce burden on courts.'''

=== Tax Incentives for IFSC Unit ===

|+ Fiscal incentives <ref>{{Cite web |title=Fiscal Incentives {{!}} Tax Incentives for IFSC Unit {{!}} GIFT CITY |url=https://www.giftgujarat.in/tax-benifits |access-date=2022-12-05 |website=www.giftgujarat.in}}</ref>

! Units in IFSC

! Income-tax

* 100% tax exemption for 10 consecutive years out of 15 years

* IFSC Unit has the flexibility to select any 10 years out of 15 years block

* MAT / AMT @ 9% of book profits applies to Company / others setup as a unit in IFSC - MAT not applicable to companies in IFSC opting for new tax regime

* Dividend paid to shareholders of company in IFSC

** From 01 April 2020, dividend income distributed by Company in IFSC to be taxed in the hands of the shareholder.

* Interest income paid to non-residents on:-

** Long Term Bonds and Rupee Denominated Bonds listed on IFSC exchanges taxable at lower rate of 4%

* Transfer of specified securities* listed on IFSC exchanges by a non-resident not treated as transfer - Gains accruing thereon not chargeable to tax in India

<nowiki>*</nowiki>Specified securities include Bond, GDR, Foreign currency denominated bond, Rupee-denominated bond of an Indian company, Derivatives, Unit of a Mutual Fund, Unit of a business trust, Unit of Alternative Investment Fund and Foreign currency denominated equity share of a company

! Goods and Services Tax (GST)

* No GST on services –

** received by unit in IFSC

** provided to IFSC / SEZ units, Offshore clients

* GST applicable on services provided to Domestic Tariff Area

| No GST on transactions carried out in IFSC exchanges

|-

|Exemption from STT, CTT, stamp duty in respect of transactions carried out on IFSC exchanges

=== Tax incentives available to SEZ Units other than IFSC units ===

* Duty free import/domestic procurement of goods for development, operation and maintenance of SEZ units

* Exemption from customs duty for all goods imported in the SEZ used for authorized operations

* Supply of goods or services from Domestic Tariff Area (DTA) to a unit located in SEZ Unit is regarded as a zero-rated supply (irrespective of the currency in which payment is being made).

* Goods and Services supplied to SEZ regarded as export for customs purpose

* Goods and Service Tax (GST)

* Supplies to SEZ are Zero Rated under IGST Act, 2017

* No GST on services,

** Received by unit in SEZ/IFSC

** Provided by SEZ/IFSC units to offshore clients

* Single window clearance for Central and State level approvals

==== State Subsidies as per the IT & ITeS Policy ====

|Stamp Duty & Registration / Conversion fee exemption

|Wherever cost is incurred 100% reimbursement of Stamp Duty and Registration Fee paid

|Electricity duty and subsidy on tariff

|100 % Reimbursement of Electricity duty and Re. 1 subsidy on power tariff for a period of 5 years.

|Reimbursement of Provident Fund contribution by employer

* 100% of EPF amount paid in case of female employees

* 75% of EPF amount paid in case of male employees

|-

|Lease rental subsidy for every 50 sq ft per employee

* Up to 20 employees -- Rs. 8 per sq. ft.

* 20 – 100 employees -- Rs. 5 per sq. ft.

* Above 100 employees -- Rs. 3 per sq. ft.

|Capital subsidy @ 25% of capital expenditure for one-time purchase of Computers, networking and related hardware, subject to a ceiling of Rs. 1 crore

<nowiki>*</nowiki>The above incentives provided by the Government of Gujrat are applicable to IFSC and GIFT SEZ Units.

===Tax Benefits for Companies<ref>{{Cite news |last=Karthikeyan |first=Suchitra |date=2022-08-29 |title=GIFT City explained: History & tax incentives of India’s first ‘Smart City’ |language=en-IN |work=The Hindu |url=https://www.thehindu.com/business/gift-city-explained-history-tax-incentives-of-indias-first-smart-city/article65736969.ece |access-date=2022-12-05 |issn=0971-751X}}</ref>===

To attract foreign and domestic investment in GIFT, the city’s international financial services centre (IFSC) was declared a multi-service Special Economic Zone (SEZ) in 2015 and the Union Budget 2016-17 provided it with a competitive tax regime. Here are the tax benefits for companies falling under IFSC:

* Minimum Alternate Tax (MAT) and Alternate Minimum Tax (AMT) not applicable to companies in IFSC opting for new tax regime.

* Tax holiday for capital gains for aircraft leasing companies, tax exemption for aircraft lease rentals

* No GST on services received by these companies, provided to IFSC SEZ units or offshore clients

* State subsidies such as 100 per cent reimbursement of stamp duty and registration fee, 100 per cent reimbursement of electricity duty and Rs. 1 subsidy on power tariff for five years, 100 per cent reimbursement of employer’s provident fund contribution, and lease rental subsidy for every 50 sq ft per employee

* National/foreign exchanges set up under IFSC have total tax exemption from Security Transaction Tax (STT), Commodity Transaction Tax (CTT), Dividend Distribution Tax (DDT), Long Term Capital Gain (LTCG), Short Term Capital Gain (STCG).<ref name=":2" />

''''' 1. Exemption from currency control regulations to IFSC Units:'''''

Under SEZ Act, a unit set up in IFSC is treated as a non-resident. Even under Foreign Exchange Management Act, 2002 (“FEMA“) units in IFSC enjoy the benefits of a non-resident under exchange control provisions.

''''' 2. Liberalized currency control regime for Indian residents:'''''

Foreign Exchange Management (Transfer or Issue of any Foreign Security) Regulations, 2004 (“ODI Regulations”) restrict investment by an Indian resident into an overseas firm in the financial services sector. To enable, Indian residents to set-up and invest funds in GIFT City, RBI, vide its Circular dated May 12, 2021 has permitted sponsor contribution from a sponsor Indian party in an Alternative Investment Fund (AIF) established overseas, including IFSC.

=== Opportunities for Banking Sector in IFSC:<ref>{{Cite web |title=Gift City In Gujarat And Incentives To Financial Sector - Financial Services - India |url=https://www.mondaq.com/india/financial-services/1154182/gift-city-in-gujarat-and-incentives-to-financial-sector |access-date=2022-12-05 |website=www.mondaq.com}}</ref> ===

'''1.Asset Business:'''

* External Commercial Borrowing (ECB) loans to Indian borrowers. Indian borrowers may prefer loans from IBU because of physical proximity and because of known documentation.

* Buyers credit facilities to Indian borrowers: Pursuant to RBI directions, Indian branches of banks are not allowed to provide buyers credit facilities to the customers. However, since IBU is an offshore branch, it can provide buyers credit facilities to Indian borrowers.

* Financing Aircraft and ship leases and acquisitions.

'''2.Liability Business:'''

* Open foreign currency current, savings accounts for Resident Individual and Non-Resident Individuals as per IFSCA Regulations.

* Foreign currency deposits from banks, corporates, or retail customers.

'''3.Exchange operations:'''

* Clearing and settlement activities for exchanges in IFSC.

* Professional clearing services.

* Custody services for securities (depository receipts) registered in IFSC.

* {{Official website|http://giftgujarat.in/}}

* [https://ifsca.gov.in/ International Financial Services Center]

* {{YouTube|YynCpCEEMYU|"Financial Centres Of The World 2020: Focus On GIFT City, Gujarat"}}