Is GIFT City for Retail NRIs or Only HNIs

A question keeps coming up in our Belong WhatsApp community. "GIFT City sounds great, but isn't it only for people with lakhs of dollars?"

Until early 2025, GIFT City's primary investment vehicles were Alternative Investment Funds. They required a minimum of $150,000.

For a mid-career NRI in Dubai earning AED 25,000 a month, that's not realistic. So GIFT City earned a reputation: a playground for wealthy NRIs, not regular ones.

That reputation is outdated. Here's what changed.

The $500 Turning Point

In September 2025, Tata Asset Management received IFSCA approval for the Tata India Dynamic Equity Fund, the first retail inbound mutual fund from GIFT City (source: Business Standard).

The minimum investment? $500.

That's a 300x reduction from the previous $150,000 AIF floor.

This fund is structured as a feeder fund. It invests in Indian mutual fund schemes and ETFs, giving NRIs exposure to Indian equities in USD.

No rupee conversion. No TDS.

No Indian tax return filing if this is your only Indian income, thanks to Section 10(4D) of the Income Tax Act.

More AMCs are following. Nippon India and Mirae Asset are both planning retail GIFT City launches. The ecosystem is shifting from exclusive to accessible.

👉 Tip: You can explore the Tata India Dynamic Equity Fund and upcoming retail schemes through Belong's GIFT City mutual fund explorer.

What's Available at Each Budget Level

Here's a realistic breakdown of what GIFT City offers depending on how much you can invest.

Sources: IFSCA Fund Management Regulations 2022 (Amended 2025); IFSCA circular dated 19 February 2025

The AIF minimum dropped from $150,000 to $75,000 in February 2025 per IFSCA's revised regulations. That's still significant, but it opened the door for upper-middle-income NRIs who were previously locked out.

The real game-changer is the $500 mutual fund tier. It puts GIFT City within reach of anyone with a savings habit.

👉 Tip: GIFT City USD FDs start at $500 with some banks. Compare current rates across all GIFT City banks before choosing.

Why the HNI Perception Stuck for So Long

GIFT City launched its IFSC operations in 2015. For the first several years, the only investment products available were structured for institutions and wealthy individuals.

AIFs dominated. PMS required large ticket sizes.

Even opening a bank account at an IFSC Banking Unit felt like a process designed for corporate treasuries, not for a software engineer in Sharjah.

Three things reinforced the "HNI only" image. Minimum ticket sizes were genuinely high.

Digital KYC didn't exist for GIFT City until 2025. And very few platforms made GIFT City products accessible to everyday NRIs.

Belong was built to change this. We aggregate GIFT City mutual funds, USD FDs, and AIF options on one platform with fully digital onboarding. No paperwork shipping. No branch visits.

What Retail NRIs Should Watch Out For

GIFT City being accessible doesn't mean every product suits every NRI. A few things to consider.

Not all funds qualify for tax exemption.

Only funds registered with IFSCA under the Fund Management Regulations 2022 qualify for Section 10(4D) benefits. Always verify the fund's IFSCA registration before investing.

Deposit insurance works differently here.

GIFT City FDs are not covered under India's DICGC deposit insurance (which covers up to ₹5 lakh for domestic deposits). They operate under IFSCA regulation, not RBI.

The banks are reputable (SBI, HDFC, ICICI, Axis), but this is a distinction worth knowing.

US and Canada-based NRIs face complications.

GIFT City mutual funds may be classified as PFICs under US tax law, triggering Form 8621 reporting.

Canadian NRIs have T1135 foreign property reporting above CAD 100,000. If you're in either country, consult a cross-border tax specialist.

UK NRIs need to check DTAA impact.

GIFT City gains are tax-free in India, but UK self-assessment rules still apply. Since there's no Indian tax paid, there's no DTAA credit to claim. You'll likely owe UK tax at your marginal rate.

👉 Tip: For UAE-based NRIs, the math is simplest. Zero Indian tax under Section 10(4D), zero UAE personal income tax. That's genuinely tax-free returns.

If You're Returning to India, Read This

Funds parked in GIFT City don't automatically get redesignated when your residential status changes.

But tax treatment might.

Once you become a resident, Section 10(4D) may no longer apply to fresh investments. If you're returning within 2 to 3 years, invest now while your NRI status qualifies you for the full benefit.

Some NRIs use GIFT City during their RNOR transition period to harvest tax-free gains before becoming fully resident.

So Is GIFT City Meant for You?

If you have $500 and an NRI status, yes. GIFT City is no longer just for HNIs. The infrastructure, products, and regulatory framework now support retail investors.

Start with a USD FD or a retail mutual fund. Build familiarity. Graduate to AIFs when your portfolio allows. The key is that you no longer have to wait until you've saved $150,000 to participate in India's most tax-efficient investment zone.

Track GIFT Nifty performance, compare GIFT City FD rates, and explore mutual fund options on Belong. Thousands of NRIs are discussing entry strategies in our WhatsApp community. Download the Belong app to get started.

Disclaimer: This article is for informational purposes only. Tax laws and IFSCA regulations are subject to change. Consult a qualified tax advisor before making investment decisions. Belong is an IFSCA-regulated platform. Past performance does not guarantee future results.