Indian distributors check out GIFT City funds

Indian investment distributors are increasingly turning to GIFT City to tap into offshore fund offerings, as demand for global equity exposure surges among retail and high-net-worth investors. But here, too, the options are limited.

- Srushti Vaidya

With the traditional route of accessing international markets via domestic mutual funds largely shut due to regulatory caps, distributors—specifically, mutual fund distributors and independent financial advisers—are eyeing GIFT City-based outbound funds as a viable alternative.

This bottleneck with the mutual fund route, however, has led to inflated premiums on older global exchange traded fund offerings, leaving investors with few options for diversification.

GIFT City, with its status as an international finance hub and relaxed regulatory environment, is emerging as a workaround, which could potentially open a new route for Indian investors seeking to diversify their portfolios with global exposure.