HSBC Holdings Plc and ICICI Bank Ltd. in GIFT City have emerged as the biggest lenders to India’s vast diaspora under a special foreign-exchange swap program, signaling the financial hub’s growing role in channeling global capital into the country.
The two lenders in Gujarat International Finance Tec-City, known as GIFT City, disbursed a combined $19.3 billion through the central bank’s concessional swap facility for foreign-currency non-resident deposits which ran from June till the end of August, according to data compiled by the hub’s regulatory body, the International Financial Services Centres Authority.
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The Reserve Bank of India’s program drew a surge in foreign-currency funding into the country, boosting activity in GIFT City. The success of the banks could encourage other lenders operating from the center to expand their wealth management operations and draw in more money from non-resident Indians.
Prime Minister Narendra Modi is positioning GIFT City as a zone capable of competing with established financial centers such as Singapore or Hong Kong.
The RBI‘s special facility spurred activity in the hub, with HSBC disbursing $10.9 billion and ICICI Bank $8.4 billion. Others included Bank of Baroda, State Bank of India and Canara Bank, according to IFSCA. The banks did not reply to emails seeking comment. Twenty lenders in the zone gave out a combined $52.8 billion in loans under RBI’s program, IFSCA said.
