GIFT City for NRIs (2026)

A Complete, Updated Guide to Structures, Minimum Investments, and Live Fund Options

GIFT City (Gujarat International Finance Tec-City) is India’s designated International Financial Services Centre (IFSC). It allows NRIs and foreign investors to invest using foreign currency, under a regulatory and tax framework that is distinct from domestic Indian markets.

Over the last 2–3 years, GIFT City has expanded beyond institutional products and now includes retail-accessible IFSC mutual funds. This has created confusion around minimum ticket sizes, tax treatment, and suitability.

This guide explains:

• What GIFT City is and how it works

• All investment structures available to NRIs

• Correct minimum investment amounts

• Live inbound and outbound IFSC mutual funds

• Tax treatment and compliance

• A clear comparison with domestic Indian investing
  
  

What Is GIFT City (IFSC)?

GIFT City is regulated by the International Financial Services Centres Authority (IFSCA) and is legally treated as a foreign financial jurisdiction within India.

Key characteristics:

• Investments are USD-denominated

• Capital is invested directly from overseas accounts

• Products are issued by IFSC-registered entities

• Domestic Indian tax rules do not apply at the investor level

How NRIs Invest via GIFT City

NRIs investing via GIFT City:

• Invest in foreign currency (primarily USD)

• Do not use NRE/NRO accounts

• Are onboarded using passport-based KYC

• Receive returns in foreign currency

These investments sit outside the domestic Indian mutual fund and brokerage framework.

Investment Structures Available in GIFT City (Very Important)

GIFT City offers three completely different structures, each with its own minimum investment, risk profile, and accessibility.

1. Alternative Investment Funds (AIFs) – IFSC

AIFs are not retail products. They are intended for HNWIs, family offices, and institutions.

Minimum Investment – AIF (IFSC)

Key Notes

• USD-denominated

• No Indian capital gains tax at investor level

• Tax (if any) is paid at the fund level

• Complex structures and reporting

• Not suitable for retail investors

2. Portfolio Management Services (PMS)

PMS is available through India-linked discretionary portfolios, including structures accessed by NRIs.

Minimum Investment – PMS

• USD 75,000

Key Notes

• Actively managed portfolios

• Higher fees than mutual funds

• India equity exposure

• Global tax reporting still applies

3. Retail IFSC Mutual Funds (Lowest Entry Point)

This is the newest and most misunderstood category.

Retail IFSC mutual funds are not AIFs and are designed for broad NRI and foreign investor participation.

Minimum Investment – Retail IFSC Mutual Funds

• As low as USD 500

Key Characteristics

• USD-denominated

• Often no Indian PAN required

• No Indian tax at investor level

• Tax (if applicable) happens inside the product

• Closest equivalent to traditional mutual funds in GIFT City

Live Inbound IFSC Mutual Funds (India-Focused Exposure)

Inbound IFSC funds invest in Indian markets, but are issued from GIFT City.

Tata India Dynamic Equity Fund – IFSC (GIFT City)

Category: Retail IFSC Mutual Fund
Exposure: Indian equities (USD-denominated)

Minimum Investment

• USD 500

Key Features

• No INR conversion

• No Indian capital gains tax at investor level

• Passport-based KYC

• PAN not mandatory (No-PAN declaration allowed)

• Returns paid in USD

This is currently one of the most accessible India-focused IFSC mutual funds for NRIs.

Live Outbound IFSC Mutual Funds (Global Exposure)

Outbound IFSC funds invest outside India using GIFT City as the platform.

DSP Global Equity Fund – IFSC (GIFT City)

Category: Retail IFSC Mutual Fund
Exposure: Global equities

Minimum Investment

• USD 5,000

Key Features

• Global equity diversification

• No Indian capital gains tax at investor level

• NAV declared in USD

• Suitable for NRIs seeking offshore exposure without overseas brokerages

PAN, KYC, and Currency Rules

PAN

• PAN is not mandatory for many IFSC retail mutual funds

• No-PAN declaration is commonly accepted

KYC

• Passport

• Overseas address proof

• Notarisation / apostille (as applicable)

• FATF-compliant country requirements

Currency

• Fully foreign-currency based

• No INR conversion

• No INR repatriation process

Tax Treatment in GIFT City

India (Investor Level)

• No Indian capital gains tax

• No Indian TDS

• No Indian income-tax return filing required for these investments

Product Level

• Tax (if applicable) is paid inside the fund

• Returns are distributed post-tax

• Tax impact is embedded in performance

Country of Residence

• Global tax rules still apply

• US, Canada, UK, Australia residents must report income

• GIFT City does not override PFIC, worldwide income, or foreign reporting laws

Comparison: GIFT City vs Domestic Indian Investing

Summary Table: Structures & Minimums (Corrected)

FAQs 

Is GIFT City tax-free for NRIs?

India does not tax investors directly, but tax may apply at the product level and in the investor’s country of residence.

Do NRIs need PAN to invest via GIFT City?

Often no, especially for retail IFSC mutual funds.

Are GIFT City mutual funds the same as Indian mutual funds?

No. They are issued under IFSC regulations and are USD-denominated.

Is GIFT City suitable for small investors?

Retail IFSC mutual funds start from USD 500, but product choice is limited.

Does GIFT City remove global tax obligations?

No. Investors must still comply with tax laws of their country of residence.

Final Takeaway

GIFT City offers:

• USD-based investing

• Simplified onboarding

• No Indian investor-level taxation

However:

• Product choice is limited

• Higher minimums apply to many structures

• Global tax compliance still applies

GIFT City is a complementary investment route, not a replacement for domestic Indian investing.