Mashreq, a leading bank from the United Arab Emirates (UAE), has been granted in-principle approval to establish a branch in GIFT City, Gujarat, India, becoming the inaugural UAE-based bank to venture into India’s international financial center. This advancement marks a significant stride in fortifying financial relations between India and the UAE and bolstering global banking operations.
Mashreq Bank’s Entry into GIFT City
The International Financial Services Centres Authority (IFSCA) has accorded Mashreq Bank preliminary approval to commence operations in Gujarat International Finance Tec-City (GIFT City). The branch will function as an International Financial Services Centre Banking Unit (IBU) and is slated to commence full-fledged operations by the conclusion of 2025. Additionally, Mashreq has secured approvals from the UAE Central Bank and relevant Indian regulatory bodies.
Purpose and Services Offered by the Branch
- The GIFT City branch will cater to the needs of international and cross-border clients.
- Services provided will include foreign currency loans, trade finance, and risk management tools.
- Benefiting from GIFT City’s strategic location and time zone, transactions will be expedited for Indian and Gulf region customers.
- The branch will also leverage tax relaxations, reducing the cost of service offerings.
Enhancing UAE–India Financial Relations
By facilitating Mashreq’s entry, the aim is to fortify financial ties between the UAE and India. As one of the premier banks in the Middle East, Mashreq can aid Indian enterprises in connecting with global counterparts, potentially fostering increased investment, trade, and capital inflow between the two countries.
Attraction of Global Banks to GIFT City
GIFT City’s allure to international banks is attributed to its state-of-the-art infrastructure and favorable regulations, positioning it as a prominent global financial hub. With Mashreq’s foray, GIFT City is poised to entice more foreign banks and corporations, underscoring the escalating confidence in India’s financial landscape.
Key Takeaways for Competitive Exams:
- Mashreq Bank secures approval to establish a branch in GIFT City, Gujarat, India, marking the first UAE bank’s entry into India’s international financial center.
- The GIFT City branch will focus on serving international and cross-border clients with services such as foreign currency loans, trade finance, and risk management tools.
- Mashreq’s presence in GIFT City is poised to strengthen financial relations between the UAE and India and attract more global banks to the burgeoning financial hub.
