India Launches Foreign Currency Settlement System via GIFT City India has taken another big step toward strengthening its position in global finance. The government has launched a foreign currency settlement system through GIFT City (Gujarat International Finance Tec-City) — India’s first international financial hub.
This new system will make it easier and faster for Indian and global businesses to settle foreign exchange (forex) transactions directly within India.
What Is GIFT City?
GIFT City, located in Gandhinagar, Gujarat, is India’s first international financial services centre (IFSC).
It works like a mini “foreign financial zone” inside India, where global banks and companies can carry out transactions in foreign currencies such as US Dollars, Pounds, or Euros — with tax and regulatory benefits.
What Is the New Settlement System?
The new system allows direct settlement of foreign currency transactions (like USD trades) within India itself — instead of routing them through global financial hubs like London or New York.
Standard Chartered India has become the first bank to handle U.S. dollar clearances under this new regime.
This means Indian companies can now settle their USD payments faster and cheaper.
Why This Is Important
Earlier, most foreign currency settlements had to pass through overseas systems, causing:
Higher transaction costs
Longer processing times
Dependence on foreign clearing networks
Now, with this new system:Â Â Settlements will be quicker and more transparent, transaction costs will reduce significantly
India’s financial independence in forex trade will grow.
Benefits for Businesses and Banks
Faster Transactions: Real-time or same-day forex settlements.
Lower Fees: Avoids multiple international bank charges.
Global Connectivity: Makes India more attractive for global investors.
Boost for GIFT City: Positions it as a global financial hub, similar to Singapore or Dubai.
Government’s Vision
This move is part of India’s larger goal to:
Promote GIFT City as an international financial powerhouse
Make India a major global player in the foreign exchange market
Reduce dependence on overseas financial systems
Final Thoughts
The launch of the foreign currency settlement system via GIFT City is a milestone in India’s financial reforms.
It will make forex transactions smoother, support businesses, and help GIFT City emerge as a key international finance center.
With banks like Standard Chartered India leading the way, India is now one step closer to becoming a global hub for cross-border financial transactions.
Also Read:-
