What Is GIFT City?
Gujarat International Finance Tec-City, or GIFT City, is India's first International Financial Services Centre, set up as a special economic zone in Gandhinagar. Under the Foreign Exchange Management Act, it's treated as foreign territory for financial dealings. That single detail changes everything for NRIs: transactions here happen in US dollars, euros, or other foreign currencies, with no mandatory rupee conversion. A single regulator, the IFSCA, oversees the entire ecosystem, combining powers that would otherwise sit separately with the RBI, SEBI, IRDAI, and PFRDA.
HDFC Bank's Role in GIFT City
HDFC Bank operates its IFSC Banking Unit from the GIFT SEZ campus in Gandhinagar, registered with the IFSCA under registration number IFSCA/CMI/Distributor/2023-24/0003, alongside its 2022 IIBX registration. This isn't a side project. In June 2026, HDFC Bank used this same GIFT City unit to raise 750 million dollars through a five-year offshore bond, priced at 5.067% and listed on India INX and NSE IFSC. That deal shows the scale at which the bank operates from this centre, well beyond retail savings accounts.
Banking Products Available Through HDFC Bank GIFT City
HDFC Bank's IBU offers a mix of accounts built for different needs:
- Call Account: zero balance, no minimum deposit, withdrawable anytime, available in multiple currencies
- Global Savings Account: interest-bearing, held in USD, with a monthly minimum balance requirement
- Offshore Fixed Deposit: flexible tenors, competitive rates, auto-renewal, and the option to switch currencies
These accounts work well for NRIs who want to park foreign earnings without routing everything back through an NRE or NRO account first.
NRI Investment Options Through HDFC Bank in GIFT City
Beyond deposits, HDFC Bank's GIFT City unit gives NRIs access to a wider set of NRI investment options:
- Mutual Funds: Customised offerings plus regular mutual fund products with built-in leverage, accessible through one platform
- Bonds: Fixed-income instruments offering steady returns with principal protection at maturity
- Demat Account: Let's NRIs buy US-listed stocks directly, including names like Apple, Amazon, and Google, without moving money to a US brokerage first
- Custody Services: HDFC Bank is registered as both a custodian and a Depository Participant with IFSCA, handling custody for Fund Management Entities and Alternative Investment Funds operating out of GIFT City
Separately, AIFs across GIFT City have also become more accessible. The typical minimum investment for many funds dropped from 150,000 dollars to 75,000 dollars in February 2025, though this figure varies by fund, so checking the specific scheme's offer document matters before assuming it applies.
Tax Benefits Worth Knowing
A large part of the appeal behind gift city investment comes down to the tax structure:
- Units operating within the IFSC get a 100% income tax exemption for 10 out of 15 consecutive years
- Interest income earned on foreign currency deposits is tax-free within GIFT IFSC
- No Securities Transaction Tax, Commodities Transaction Tax, or GST applies to eligible transactions on IFSC exchanges
- Capital gains tax is exempt on specified securities under IFSCA Fund Management Regulations, 2022
Actual tax treatment still depends on your country of residence and the specific instrument, so this shouldn't replace advice from a tax professional familiar with your situation.
A Practical Example
Consider an NRI based in Dubai earning in AED who wants dollar exposure without repeatedly converting currency. Instead of parking funds in a regular NRE fixed deposit, where returns are pegged to the rupee, they open a Global Savings Account with HDFC Bank's GIFT City unit, transfer funds via SWIFT, and split the amount between a USD fixed deposit and a demat account holding US tech stocks. Their principal stays in dollars throughout, so a weakening rupee doesn't erode their returns the way it would with a standard NRE deposit.
Conclusion
HDFC Bank's presence in GIFT City gives NRIs a genuine alternative to routing every investment through mainland Indian accounts. Between foreign currency deposits, demat access to US stocks, and a regulatory framework built for cross-border banking, it addresses a real gap in how nri investment plans have traditionally worked. As with any financial decision, matching the product to your residency status and long-term goals matters more than chasing the highest headline rate.
Tax-Free Returns at Maturity
Smart Investing for Long-Term Wealth Creation
Seamless US Dollar Investments from India
