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Capital commitments through India's GIFT City grew 60-fold in five years.

India's capital markets are maturing fast, with especially private equity and venture capital increasing their investments in the country. Data from the past few weeks also shows that European capital is increasingly positioning itself accordingly, and that one hub in India provides the key signal international investors should follow.

Maturing capital markets require infrastructure to underpin them. For outside investors, GIFT City is one of, if not the most established entry base into India. Located in Gandhinagar, Gujarat, the Gujarat International Finance Tec-City (GIFT) was purpose-built as India's first International Financial Services Centre (IFSC), a dedicated regulatory and financial zone designed to bring offshore activity that historically flowed through Singapore, Dubai, or London back onshore into India. You can think of it as India's answer to those global financial hubs, but with the added advantage of direct access to one of the world's fastest-growing economies.

The numbers are telling:

This development is supported by deliberate government action. The Union Budget 2026-27 doubled the tax holiday for GIFT City IFSC units from 10 to 20 consecutive years within a 25-year block, a significant policy signal that this is a permanent financial centre and not only a transitional incentive zone.

The table below puts the numbers in context:

*disclaimer: no financial or tax advice, for information only.

With 35 banks now operating from the IFSC and over USD 100 billion in foreign-currency loans disbursed, the infrastructure has already scaled well.

Three distinct moves in April alone illustrate the increasing interest by European (and Asian) capital market players:

For European corporates watching these developments, the pattern is consistent with what I keep sharing: the India market entry question has shifted and is accelerating across all sectors. The capital market infrastructure is deepening, the regulatory framework is stabilising, and European peers already start allocating thanks to the financial infrastructure maturing.

Sources: GIFT City, ANI, OpenPR, The Economic Times

ZEISS is a global leader in optics and optoelectronics and one of Germany’s famous “Hidden Champions”, SMEs or “Mittelstand” companies that are privately owned and global leaders in their fields. Its solutions cover both the B2B as well as B2C market.

The company’s fastest growing markets are in Asia. India, China, and Southeast Asia are leading the way and especially India is named as key growth market, being head to head and often leading in sales growth for its optics solutions compared to China. The group’s India revenue reached INR 2,410 crore (around EUR 220 million) during the financial year ending on March 31, 2025 at a CAGR of 17%. Latest data should be released soon as well.

The following development further confirms ZEISS’ focus on India:

Especially ZEISS’ new production site is a clear indicator for India as market, and regional hub as well. It’s the largest lens manufacturing site globally and will distribute lenses not only to India, but the whole EMEA market plus some Western European markets.

The delivery model is a combination that I can see increasingly shaping corporate strategies. India’s large domestic market invites local manufacturing capacity that eventually creates advantages for global supply chains of multinational businesses. This is not isolated to European or industrial businesses though, but surely a key leverage for them. And I see collaborations strengthening across all sectors.

Sources: The Economic Times

At the beginning of the year, I shared that the German chancellor’s visit at that time was the start of a cascade of Indo-European exchanges and visits, which continue to take place till this day. In the meantime, the EU-India Free Trade Agreement (FTA) was agreed, many delegations started taking place, and just last week a high-level visit from Austria confirms the strengthening ties between both regions.

Austria’s Chancellor Christian Stocker headed the high-level delegation that also included 60 high-ranking business leaders. The country has had diplomatic relations with India for over 75 years and expects exports to surge by over 75% once the FTA is finalized and signed.

Austria’s trade with India grew over the past 10 years:

India and Austria concluded the visit by signing 15 agreements from defence partnerships, stronger collaboration in high tech developments, academic research, and education, as well as workforce mobility and start-up cooperation.

These bilateral agreements add to the layer of agreement on an EU level, and several comparable agreements India secured with other European nations including Germany as well. The political signal is very clear, and I already see European businesses recognising the political support of deeper ties with India. I therefore expect more business focused delegations, and even board meetings, taking place in India for two reasons: improve their understanding of the market, and exploring new opportunities.

Sources: ANI, MSN

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This week: GIFT City - The History

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