AHMEDABAD: India has a funding gap of $10.1 trillion to meet its net zero commitment, and therefore, the International Financial Services Centre Authority (IFSCA) – the unified regulator needs a platform where green credit can be traded, said Union finance minister and minister of corporate affairs, Nirmala Sitharaman. Addressing a seminar on ‘GIFT City – an aspiration for modern India’, organized as part of VGGS 2024 in Gandhinagar, Sitharaman said that GIFT City has now expanded into becoming a major international financial hub.
“There should be a platform for IFSC where green credits can be traded. The authorities here should work on getting a platform ready so that green credits can be sold by people who are planting trees. GIFT City can help bridge the funding gap for India to meet its net zero targets through such a platform,” the minister said.
“Miyawaki forests are coming up all over the country. People doing that and other practices in afforestation or activities related to renewable energy, solid waste management, and so on, should be able to come here and say, ‘I have credits, which I don’t want to sit on, let it be traded’. This place should be where the credits are bought and sold,” she added.
She also assured the Gujarat government and the IFSCA of the ministry’s full support and cooperation.
In 2023, the Union government announced that companies would soon be able to list themselves directly on the IFSC exchanges. At present, Indian companies can only access foreign equity markets through issuing depository receipts or by listing their debt securities on foreign markets.
Speaking on the issue, Sitharaman said, “The much-awaited direct listing of stock in GIFT IFSC was announced earlier. We are systematically going through the process, and I am confident it will happen soon. With this, Indian companies should be able to access global funds easily being listed in India.”
The unified IFSCA is working with the finance ministry on several new initiatives. Elaborating on them, IFSCA chairman K Rajaraman said, “We are working on a single window IT system that will enable all regulatory clearances to be approved online. The system will go live in March 2024.”
“GIFT City banks have lent $700 million as sustainable finance, and $12 billion worth of sustainable bonds have been listed. We will work towards making IFSCA a climate finance hub for India and the Global South. Two expert committees have been set up to recommend establishing a voluntary action market and making IFSCA a climate financing hub,” he added. The cumulative banking asset size is at $52 billion currently in GIFT City.”
Emphasising GIFT City’s strategic importance, the minister said, “The best adoption rate for fintech globally is 80%. A fintech company based in India should have a presence in GIFT City. Any international fintech company looking to do business in India needs to have offices here. GIFT City has invested $10.18 billion in green bonds.”
