As international breach overseas investment limits, several schemes have either stopped accepting fresh investments or reopened for limited periods. However, offers an alternative route for Indian retail investors seeking global exposure.
Here’s what retail investors need to know about investing through GIFT City.
How can GIFT City help retail investors?
Aditya Agarwal, Co-Founder, Wealthy.in said, “GIFT City is currently the main open channel for a resident Indian who wants meaningful global equity exposure through a pooled fund.”
He said three features make it relevant for retail investors:
- Treated as offshore: Under India’s foreign exchange rules, IFSC units are treated as non-residents despite being located on Indian soil. They are regulated by IFSCA, not SEBI.
- Operates in foreign currency: Funds, deposits, and trades in GIFT City are denominated in USD and other foreign currencies, not rupees.
- Outside the domestic overseas-investment cap: SEBI and the RBI limit the Indian mutual fund industry’s overseas investments to roughly $7 billion across schemes investing in foreign securities, plus a separate $1 billion window for overseas ETFs. GIFT City funds, being treated as offshore rather than domestic, are not subject to this ceiling.
How can a resident Indian invest in a GIFT City fund?
Agarwal explained the following steps:
- Check eligibility: Check whether the fund is meant for outbound or inbound investments, as inbound funds aren’t open to residents.
- Complete KYC: Submit PAN, Aadhaar, address proof, cancelled cheque, FATCA/CRS declarations and risk-profile details. Your CKYC is verified first.
- Use your existing bank account: You don’t need a GIFT City bank account. Remit money from your resident savings account. Some fund platforms offer integrated remittance with specific banks. Otherwise, you may need to make a SWIFT transfer.
- Remit under LRS: Submit Form A2 and LRS declaration to your bank. The bank converts rupees into dollars at its card rate, deducts charges, and applies TCS if applicable.
- Get units: Once the money is received by the fund, units are allotted. NAV is declared daily in USD. You can track your portfolio and transactions through the fund’s GIFT City platform or app.
- Redeem your investments: Redemption proceeds are paid in USD, which you then convert back to rupees through your bank — incurring a second round of conversion cost.
Which GIFT City funds are available for investors?
Agarwal said seven retail outbound schemes across five fund houses were live. All are USD-denominated, open-ended, and IFSCA-registered, and available to resident Indians under LRS. He explained the structure of each fund.
| Fund | Style | Exposure | Minimum Investment |
| Parag Parikh IFSC S&P 500 FoF | Passive | 500 US large caps | $500 |
| Parag Parikh IFSC Nasdaq 100 FoF | Passive | tech-heavy | $500 |
| HDFC International Developed Markets Equity Fund | Passive | MSCI World; 23 developed markets, around 72% US exposure | $5,000 |
| HDFC International Emerging Markets Equity Fund | Passive | MSCI Emerging Markets Index | $5,000 |
| DSP Global Equity Fund | Active | 27–40 global stocks; valuation-led | $5,000 |
| Edelweiss Greater China Equity Fund | FoF | China, Taiwan and Hong Kong | $10,000 |
He said PPFAS and HDFC funds are passively managed, tracking indices without taking active calls, while DSP and Edelweiss are actively managed.
According to Agarwal, PPFAS offers US exposure through the S&P 500 and Nasdaq 100. HDFC covers developed and emerging markets. DSP provides global exposure, while the Edelweiss fund offers concentrated Greater China exposure through a JPMorgan Greater China fund.
“Following the 25 August 2026 change, PPFAS has the lowest entry at $500, while the other funds still require $5,000. The top-up is $500 for all funds,” he mentioned.
Does investing in a GIFT City fund fall under the LRS?
Yes.
Agarwal noted that “For a resident individual, a GIFT City investment is an LRS remittance and consumes your LRS limit, even though the money never physically leaves India”.
He said LRS permits a resident individual to remit up to $250,000 per financial year across all purposes — overseas investment, foreign travel, education, medical treatment, gifts and maintenance of relatives abroad.
Can investors start an SIP in GIFT City funds?
No. “There is currently no rupee auto-debit SIP available in GIFT City outbound funds,” Agarwal said.
Which global markets can investors access via GIFT City?
Agarwal said can access the US, Japan, the UK, Canada, France, Taiwan, South Korea, China, India, Brazil, Singapore, Hong Kong, and others.
What are the key limitations of the GIFT City route?
Agarwal said foreign exchange costs apply both ways, with around a 2% spread on a round trip, plus SWIFT, bank, and fund fees—making small, frequent investments costlier.
He said tax is another drawback. Gains within 24 months are taxed at roughly 42.75% irrespective of your slab, while the concessional 14.95% rate applies only after two years, versus 12 months for domestic equity.