India is weighing the introduction of real-time foreign-exchange settlements in euros at its flagship international financial hub in Gujarat, a move aimed at deepening financial integration with the European Union as trade negotiations gain momentum.
The International Financial Services Centres Authority, which oversees the Gujarat International Finance Tec-City, has proposed allowing euro settlements alongside the US dollar, aligning with efforts to enhance market access under the EU-India trade pact. This development builds on last year’s rollout of real-time dollar settlements at GIFT City, a key step in positioning the hub as a competitive offshore financial center for global investors.
Under the existing system, Standard Chartered Plc. facilitates dollar transactions on a real-time gross settlement basis. The process has slashed interbank settlement times from up to 24 hours to mere seconds, cutting reliance on overseas banking networks. It has also reduced liquidity, operational, and settlement risks, boosting efficiency for market participants.
Expanding to euro settlements could further elevate GIFT City’s appeal, especially as India seeks to strengthen its financial infrastructure amid growing cross-border trade. The hub is already a focal point for the country’s push to attract international capital, offering a streamlined environment for banking and investment activities.
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The timing aligns with broader geopolitical and economic priorities, as India aims to diversify its financial systems and reduce dependency on traditional global banking channels. A successful integration of euro settlements would mark another milestone in the country’s ambition to rival established financial centers.
If implemented, the euro settlement system could process transactions with the same speed and risk mitigation benefits seen in the dollar framework, potentially transforming GIFT City into a dual-currency powerhouse for real-time financial operations by the end of 2026.
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