NEW DELHI: In the Union Budget 2025-26, Finance Minister Nirmala Sitharaman announced a series of measures aimed at strengthening Gujarat’s International Financial Services Centre (IFSC) to make it more attractive for global businesses.
Sitharaman shared, “To attract global businesses, we are extending the cut-off date for commencement in IFSC by five years, until March 31, 2030.”
This extension will give companies more time to set up operations within the IFSC, providing them with an extended window to take advantage of the benefits offered.
Additionally, tax exemptions have been introduced to boost sectors like ship leasing, insurance, and treasury activities.
“We are providing a series of tax exemptions to promote ship leasing, insurance, and treasury operations within IFSC,” she said.
One of the key changes includes a full tax exemption on life insurance policy proceeds issued by IFSC insurance intermediaries, without any premium conditions.
For example, a global insurance company setting up in the IFSC can now issue policies without worrying about premium limits for tax benefits.
“This move will make IFSC an attractive hub for global insurance businesses,” Sitharaman explained.
In addition, the government has also extended capital gains exemptions for non-residents and IFSC units on the transfer of equity shares of domestic ship-leasing companies.
This will further encourage investments in ship leasing, an emerging sector in India.
To support treasury operations, loans and advances between group entities where one entity is set up in IFSC for treasury activities will no longer be considered dividends.
This will simplify financial operations for companies working within the IFSC.
The finance minister also announced the introduction of a simplified safe harbor regime for investment funds managed by fund managers based in IFSC, making it easier for such funds to operate.
“Our vision is to make IFSC a global financial powerhouse, driving India’s economic future,” she concluded, reinforcing the government’s commitment to making Gujarat’s IFSC a key player on the world financial stage.
