Where the Ships Don't Come: GIFT City and the Changing Geography of Global Finance

A few weeks ago, while reading about the history of international finance, I noticed something that seemed almost too obvious to be interesting: many of the world's great financial centres grew out of places where people traded.

London, New York, Singapore, Hong Kong, and Dubai have very different histories, but there is a broad pattern. They were ports, entrepôts or commercial crossroads before they became major financial centres. Ships brought goods; merchants followed them; information, credit, insurance, foreign exchange and investment followed the merchants. Over time, commercial and financial institutions accumulated in the same places.

That prompted a slightly mischievous question when I thought about India's GIFT City.

Why is India attempting to build an international financial centre in Gandhinagar, an inland planned city with no historic port?

But perhaps that question belongs to an older geography of capitalism.

The more interesting question may be whether, in the twenty-first century, shipping, finance and technology can remain equally important to global commerce without having to be physically located together.

When ships and finance grew together

Global commerce has always required at least two kinds of infrastructure.

There is the physical infrastructure: ships, ports, warehouses, roads, railways, container terminals, and logistics networks.

And there is the financial infrastructure: credit, insurance, foreign exchange, banking, investment, securities markets, and risk management.

For centuries these tended to be geographically concentrated in the same places because physical commerce itself was concentrated there.

London's commercial and financial history grew around the Thames and the City. New York was a maritime trading city before Wall Street became synonymous with finance. Singapore's modern transformation began with its role as an entrepôt. Hong Kong's position as a trading gateway to China helped create the commercial ecosystem from which its financial centre emerged. Dubai's history moved from pearl diving and trading through re-export commerce and free zones towards a much broader business and financial economy.

The point is not that finance replaced shipping.

It didn't, and it cannot.

Global trade still depends enormously on shipping. The container ship remains one of the great pieces of infrastructure of globalisation. What has changed is that the financial infrastructure serving global commerce no longer has to be beside the physical infrastructure carrying it.

Gujarat itself offers a particularly interesting historical example.

Its international commercial history goes back several thousand years to ancient ports and the maritime trading networks of the Indian Ocean. Surat, in South Gujarat, subsequently became one of the great commercial centres of modern India, connecting western India to the Red Sea, Persian Gulf, and wider Indian Ocean maritime region. In contemporary times, the Surat region has acquired another identity as a major industrial centre, with the Hazira area hosting large industrial centres, including those of RIL and AM/NS.

So Gujarat has accumulated several layers of global economic connectivity over centuries.

GIFT City represents yet another layer.

A financial centre that was built rather than inherited

GIFT City was conceived in the 2000s as a planned business and financial district in the Ahmedabad region, primarily by then Chief Minister Narendra Modi. Gandhinagar, the new capital city, offered something that an old commercial city might not: available land, planned infrastructure, and the possibility of coordinated development under strong political leadership.

This is important because GIFT City is not really the product of Gandhinagar's economic history.

It could, in principle, have been built in several parts of India.

Its initial advantage was less an inherited commercial ecosystem than the availability of land and utilities, proximity to Ahmedabad, and a state government willing to undertake a large, long-term experiment.

In that sense, GIFT City is place-created rather than place-inherited.

The subsequent creation of an International Financial Services Centre, and then the International Financial Services Centres Authority (IFSCA) in 2020, gave the project a much more consequential institutional character.

It was no longer simply a new business district with modern buildings. It was becoming a specialised financial jurisdiction.

This is where its history begins to diverge sharply from that of London or Surat.

Those places accumulated their commercial and financial ecosystems over generations.

GIFT City is attempting to construct the ecosystem deliberately.

The port and the financial centre no longer have to be next door

None of these makes physical geography irrelevant.

India needs efficient ports and shipping networks just as much as it needs banks and financial markets. If India wants to become a major trading and manufacturing power, ships, ports, logistics and industrial infrastructure will remain indispensable.

But financial technology has changed the relationship between the physical and financial economies.

A container ship can carry goods from Mundra to Rotterdam while the financing of the transaction, its insurance, foreign exchange and investment structures are arranged somewhere else.

An Indian company can borrow dollars through an institution in GIFT City without a single physical object travelling through Gandhinagar.

Capital can cross oceans electronically.

Information can travel almost instantaneously.

Financial claims can be created, transferred and settled thousands of kilometres from the goods or assets to which they relate.

The result is not the disappearance of the port.

It is the decoupling of the geography of finance from the geography of physical trade.

This distinction matters.

The future does not require us to choose between shipping and finance. It may instead involve increasingly sophisticated networks in which ships move the physical economy and financial institutions move capital and risk around it.

GIFT City's proposition is therefore not to replace the port.

It is to build the financial layer somewhere else.

Then came the $127-billion moment

This possibility became much more tangible with the recent FCNR(B) episode.

India's special FCNR(B) window mobilised $127.2 billion in foreign-currency deposits. What caught my attention was GIFT City's role in the mobilisation.

By August 31, International Banking Units at GIFT IFSC had sanctioned about $54.02 billion under the facility, of which approximately $52.82 billion had actually been disbursed.

In other words, roughly $53 billion—around 42% of the total FCNR(B) mobilisation—was channelled through GIFT City's international banking infrastructure.

The same IBUs also facilitated $11.62 billion of external commercial borrowings, while Indian banks raised $11.12 billion through bond issuances on IFSC exchanges during the April-August period.

The significance of these numbers is not simply that they are large.

It is that they show something happening beyond GIFT City itself.

GIFT City already had a large and growing collection of financial institutions. But this episode demonstrated a visible connection between that institutional ecosystem and a large national financial requirement.

Foreign-currency resources were mobilised and a substantial part of the associated financial intermediation passed through institutions located in GIFT City.

I would not call this literally the first benefit GIFT City has produced for India. It already has banking assets, exchange activity, funds, insurance, leasing and other financial businesses.

But it is one of the clearest examples yet of national financial transmission.

And that is a more interesting achievement than simply counting the number of offices located in a financial district.

What should an international financial centre owe the country that builds it?

This brings me to a larger question.

If a country deliberately creates an international financial centre, it is likely to provide land, infrastructure, utilities, connectivity and institutional support. It may also provide tax concessions and regulatory advantages to make the jurisdiction competitive.

There is nothing inherently wrong with this.

But it raises a legitimate question, particularly in a developing country:

What does the country get in return?

An international financial centre can produce first-order benefits simply by attracting financial activity. Banks, funds, insurers, exchanges, professional firms and technology companies generate employment, expertise, liquidity and business.

But there can be another layer of benefit.

The financial centre can help mobilise overseas savings, give domestic companies better access to international capital, bring financial activities that would otherwise occur offshore into the country, develop domestic capabilities in sophisticated financial services and connect domestic investors with the rest of the world.

I think of this as the national dividend of an international financial centre.

It need not mean that the government directly collects a large tax bill from every transaction. The dividend can be strategic and economic.

The FCNR(B) episode looks like one example.

And then there is the “T” in GIFT

There is another reason GIFT City could eventually acquire a distinctly Indian character: technology.

India does not have to import an entire technology ecosystem to build an international financial centre. It already possesses a vast FinTech ecosystem, sophisticated digital-payment infrastructure and a large technology-services industry.

The relationship between Indian IT companies and the global BFSI sector is particularly important. Banking, financial services, and insurance have long been among the largest markets for India's IT-services companies. Many major Indian IT companies have established operations at GIFT City, mainly to serve financial-sector clients.

This creates an interesting potential triangle:

international finance + Indian IT capability + Indian FinTech.

The historical financial centre brought together the merchant, banker, insurer, lawyer, and exchange.

A twenty-first-century financial centre may increasingly bring together the bank, insurer, fund, exchange, FinTech company, software company, data infrastructure, and AI capability.

IFSCA reported 120 TechFin and ancillary-service providers at GIFT IFSC as of March 2026.

This makes me wonder about GIFT City's name itself. GIFT officially stands for "Gujarat International Finance Tec". But perhaps its last letter should now denote "and Technology".

India may not possess London's centuries-old financial history. It does, however, possess something London could not possibly have possessed when its financial system was taking shape: a huge digital economy, a mature IT-services industry, a vast FinTech ecosystem and the experience of providing technology to financial institutions across the world.

IFSCA's recent exploration of GPU and connected data-centre equipment leasing is an intriguing example of how financial services could begin interacting with the infrastructure of the AI economy itself.

Finance and technology do not necessarily have to be physically colocated either. Bengaluru, Mumbai, Hyderabad and other technology centres will remain important. But finance and technology increasingly have reasons to cluster institutionally, because technology is no longer merely a service supplied to finance from outside. It is becoming part of the machinery of finance.

From financial district to financial interface?

GIFT City's scale is beginning to become substantial.

IFSCA reported more than 1,100 final registrations and authorisations by March 2026, banking assets above $111 billion, cumulative fund commitments above $39 billion and hundreds of aviation and shipping assets leased through the IFSC.

The longer-term growth is even more striking. Registrations and authorisations rose from 110 in March 2021 to around 1,193 five years later—a more than tenfold increase.

But perhaps the direction of the flows is more important than the numbers.

GIFT City is developing channels for World → India: FCNR(B) deposits, external commercial borrowings, international banking, reinsurance and foreign investment.

At the same time, it is developing channels for India → World: international investment funds and opportunities for Indian investors to diversify globally.

This suggests that GIFT City may eventually become something more useful than an Indian imitation of Wall Street.

It could become India's financial interface with the world.

That would be a distinctive role.

But the experiment is not over

None of these means that GIFT City has become another London, Singapore, or Hong Kong.

Financial ecosystems require more than office towers, tax incentives and regulatory notifications. They need liquidity, trust, expertise, market depth, reputation and network effects. The historic financial centres accumulated these over decades and centuries.

GIFT City is attempting to compress that historical process.

Whether it succeeds remains an open question.

And perhaps that is precisely why it is worth watching.

The important development may not be that India has finally built a global financial centre.

It may be that, after years of institution-building, we are beginning to see what such a financial centre can actually do for the country around it.

Conclusion: Where the ships don't come

The great financial centres of the past often grew where ships arrived. That was not an accident. Global commerce needed physical infrastructure and financial infrastructure, and for centuries the two grew together.

India does not need to choose between them.

Its ports and shipping networks will carry the physical economy of globalisation. Its financial centres can carry capital, risk, and investment across borders. Its technology ecosystem can increasingly connect and transform both.

The three systems remain equally important.

They simply no longer have to be geographically contiguous.

That may be the more interesting way to understand GIFT City.

The real test is not whether international money can pass through Gandhinagar. A developing country can create an international financial enclave and measure its success by assets, turnover, registrations, and the number of global institutions that set up offices there.

But if the country has provided the land, infrastructure, tax concessions, and institutional support, there is a more fundamental question:

What does the country get back?

The recent FCNR(B) mobilisation provides an intriguing early answer.

For once, the financial activity taking place at GIFT City was not merely something happening in GIFT City. It was visibly connected to a large national financial requirement.

That does not prove that GIFT City has arrived.

It does, however, suggest that the machinery being built there may be beginning to perform a function beyond itself.

Surat's ships connect Gujarat to the world through the physical movement of goods. GIFT City may eventually connect India to the world through the movement of capital, financial services, and technology.

The ships need not come to Gandhinagar. But the capital that comes there should, in some form, help move India forward.