French and UAE Banks Set to Expand Footprint in GIFT City’s Financial Landscape

In a significant boost to India’s International Financial Services Centre (IFSC) ambitions, foreign banks from France and the UAE are lining up to establish IFSC Banking Units (IBUs) in GIFT City, Gujarat. With recent approvals to Natixis, Credit Agricole, and applications from Societe Generale, First Abu Dhabi Bank PJSC, and Mashreq Bank, GIFT City is fast becoming a preferred global hub for cross-border banking and financial services.

Why in News?

The International Financial Services Centres Authority (IFSCA) has issued in-principle approvals to major French and UAE banks to set up IFSC Banking Units (IBUs). The total number of IBUs in GIFT City has now reached 31, more than doubling since 2022. This development highlights GIFT City’s growing global stature and India’s increasing attractiveness as a financial services destination.

What is an IBU?

• An IFSC Banking Unit (IBU) is similar to an overseas branch of a bank located in GIFT City.

Offers USD-denominated services like,

• Deposits
• Term loans
• External commercial borrowings (ECBs)
• Trade finance
• Interbank placements

Foreign Banks Joining GIFT City

France

• Natixis
• Credit Agricole
• Societe Generale (Application pending)

UAE

• First Abu Dhabi Bank PJSC
• Mashreq Bank PSC
• West Asia First Mover
• Qatar National Bank (First from West Asia to set up base last month)

Domestic Expansion

• Bank of Maharashtra has also applied to set up an IBU.
• Yes Bank was the first bank to establish an IBU in October 2015.
• Axis Bank and Standard Chartered have recently expanded their offices within GIFT City.

Growth in Numbers

IBUs in GIFT City

• 2022: 15
• March 2025: 29
• June 2025: 31
• Foreign IBUs: 14 of the 31 currently operational
• Cumulative assets (March 2025): $88.5 billion+

Significance and Strategic Vision

• Reflects global confidence in India’s financial reforms and liberalisation.
• Aligns with India’s vision to make GIFT City a top-tier global financial centre.
• Provides a tax-efficient and regulated ecosystem for international banks and investors.
• Supports foreign capital flow, global investments, and trade financing through India.