Global Investors Shift Focus to GIFT City as West Asia Conflict Intensifies
Mumbai: The escalating geopolitical tensions in West Asia are prompting global investors and non-resident Indians to reassess their concentrated exposure to Dubai. This has led to a surge in inquiries about India's International Financial Services Centre (IFSC) at GIFT City.
While Dubai remains a dominant hub for capital, wealth management, and investments, recent volatility has triggered a diversification push. Investors are now seeking additional jurisdictions that offer regulatory stability and proximity to growth markets like India.
"Geopolitical volatility in West Asia is beginning to reflect in higher enquiries for office space at GIFT City, particularly from institutions and intermediaries evaluating an India-linked base within the IFSC," said Aaryan Shah, associate director at Savvy Group. "We are seeing a gradual shift towards a 'dual-hub' strategy rather than a full relocation from Dubai. While conversions are still measured, the quality of conversations has improved, with a sharper focus on regulatory certainty and long-term presence."
Shah added that incentives in the 2026-27 budget and improvements in social infrastructure are supporting investment inflows and improving long-term leasing visibility at India's only IFSC. The budget allows IFSC units a 100% deduction on specified income for 20 consecutive years within a 25-year block, compared with the earlier 10-year window. After this period, business income from IFSC operations will be taxed at 15%, against 35% for overseas companies elsewhere in India.
Over the past six months, following key infrastructure announcements, GIFT City is increasingly emerging as a key financial hub. "The recent geopolitical tensions in the Middle East have further accelerated this shift," said Anuranjan Mohnot, managing director at Lumos Equity Advisors. "Upgrades in social infrastructure, liberalised policies, the entry of foreign universities, a strong talent pool, and competitive real estate costs have made it attractive compared to other global hubs."
Property consultants have noted a significant increase in conversations in recent weeks, particularly among UAE-based investors evaluating cross-border structures. "We are seeing more inbound queries from clients based in the Gulf who want to hedge geographic risk," said a senior executive at an international property consultancy. "The interest is not about exiting Dubai, but about adding another layer of safety and flexibility."
With its foreign currency-denominated ecosystem, tax incentives, and a unified regulator in the International Financial Services Centres Authority, GIFT City is being positioned as a gateway for global capital into India, especially for fund management, leasing, and structured finance. The narrative is shifting from efficiency and tax optimization to include geopolitical risk mitigation, with India seen as a relatively stable macro environment. GIFT City allows investors to plug into this stability without fully relocating capital.
However, stakeholders cautioned against overstating the shift. Dubai's deep liquidity, established legal frameworks, and mature ecosystem, anchored by the Dubai International Financial Centre, continue to underpin investor preference. Indian investors remain key participants in Dubai's property and financial markets.
