For a manager raising a GIFT IFSC fund, GIFT City investment is open to foreign investors, NRIs and OCIs, resident Indian individuals and Indian companies. Each comes in through a different legal route with its own limit. IFSCA’s FM Regulations set the ticket sizes and investor counts for every investor. SEBI’s FPI rules cap NRIs, OCIs and resident Indian individuals, and limit resident entities, where the fund invests in listed Indian securities. RBI’s rules govern money from India: the Liberalised Remittance Scheme (LRS) for individuals, and overseas portfolio investment (OPI) for companies and LLPs. FEMA capacity (OPI) does not by itself satisfy SEBI’s FPI Regulation 4: where the fund is an FPI, resident non-individuals cannot be constituents except the fund management entity or its associate, up to 10%. An unrelated Indian company therefore cannot invest in an IFSC fund registered as an FPI.

Below, each investor type is taken in turn: route, limits, and what the manager checks. Fund set-up is covered in GIFT City AIF Setup.

Table of Contents

GIFT City investment routes by investor type

Investor	Route into the fund	Main limits	What the manager checks
Foreign individual or institution	Direct subscription from abroad	IFSCA ticket size, accredited status, investor count	KYC/AML; accredited evidence if below the ticket
NRI or OCI	Direct subscription from abroad	As above; plus, if the fund is an FPI, below 25% each, and below 50% in aggregate unless the IFSC route is used (which lifts only the aggregate cap)	Investor status; FPI route and DDP declaration
Resident individual	LRS remittance: OPI for fund units; ODI for equity in an IFSC company	USD 250,000 per financial year across all LRS use; TCS above ₹10 lakh; if the fund is an FPI, only global funds with Indian exposure below 50% (Reg. 4(c)(iii))	PAN; that the bank has processed the remittance under LRS
Indian company, LLP or registered partnership firm	OPI in units of an IFSC fund, including sponsor contribution	OPI capped at 50% of net worth; if the fund is an FPI, an unrelated Indian entity cannot be a constituent: FPI Reg. 4(c) admits resident non-individuals only as the FME or its associate, up to 10%	Board-level OPI headroom; AD bank reporting; FPI status of the fund
Resident trust or HUF	No established ordinary route	LRS not available; not an “Indian entity”	Subscription should not be accepted without a separately established legal basis
Government, SWF, pension fund, regulated fund	Direct subscription	Deemed accredited, so no minimum ticket for venture capital schemes, restricted schemes and PMS. Regulated funds qualify if they are IFSC schemes, or Indian or foreign regulated funds with no investor above 33%	Evidence of deemed status

Rules that apply to every investor

Ticket sizes and investor counts (FM Regulations 2025, consolidated to 10 September 2026):

Scheme	Minimum per investor	Lower ticket for FME staff	Investor count
Venture capital scheme	USD 250,000 (Reg. 20(2))	USD 60,000 for employees, directors or designated partners	Not more than 50 (Reg. 20(1))
Restricted scheme (filed as Category I, II or III AIF)	USD 150,000 (Reg. 32(2))	USD 40,000	Not more than 1,000, or as IFSCA specifies (Reg. 32(1))
Retail scheme	USD 10,000 for a close-ended scheme with more than 15% in unlisted securities (Reg. 47(2)); no other minimum was found	—	At least 20, none above 25%, within six months of closure (Reg. 44); “no ceiling” (Reg. 2(1)(ff))
Portfolio management services	USD 75,000 (Reg. 77(1))	—	—

An investor and spouse, parent or child may invest jointly to reach USD 250,000 in a venture capital scheme (Reg. 20(2)). For a restricted scheme the joint figure is USD 150,000, with no more than two such joint investors (Reg. 32(2)). A close-ended retail scheme with a minimum below USD 10,000 must list on a recognised stock exchange (Reg. 109). The categories are covered in Category I, II and III AIFs in GIFT City.

Accredited investors skip the minimum ticket for venture capital schemes, restricted schemes and PMS (Regs. 20(2), 32(2), 77(1)). The criteria are in IFSCA’s circular of 25 January 2024, which still applies under the 2025 Regulations (FAQ Q178):

Investor	Test (para 1, accredited investor circular)
Individual, sole proprietor, one-person company	Gross income of at least USD 200,000 in the preceding financial year, with a reasonable expectation of a similar level in the current year; or net assets of at least USD 1 million of which USD 500,000 is financial assets, excluding the primary residence, as at a date no older than six months
HUF or similar single-family structure	The individual income or net assets test
Partnership firm	All partners qualify, or net worth of at least USD 5 million with qualifying decision-makers
Trust	All beneficiaries qualify, or net worth of at least USD 5 million with qualifying decision-makers
Body corporate, including LLP	Net worth of at least USD 5 million, or all constituents qualify
Deemed accredited	Governments, central banks and sovereign wealth funds (and entities they control or 75% own), multilaterals, university, pension and provident funds, IFSC schemes and family investment funds, and regulated financial entities

Spouses may combine income or net worth. For a parent and child, at least one must qualify alone and make the decisions (para 1(a)(iii)).

The manager decides whether to accept an investor as accredited. It must lay down adequate procedures and an internal policy for verifying and periodically reviewing eligibility, and may rely on an accountant’s certificate from the preceding six months (para 2(a)–(b)). The investor must confirm in writing that investor protections may be lower (para 4).

KYC and AML. The FME must comply with “the Anti-Money Laundering/ Combating the Financing of Terrorism (AML/CFT) norms as applicable” (Third Schedule, Part A(n)). It must keep AML/CFT records and each client’s account-opening documents for at least eight years (Reg. 119(2)(e), (f)). The FM Regulations refer to the IFSCA (Anti Money Laundering, Counter Terrorist Financing and Know Your Customer) Guidelines, 2022 (Reg. 2(1)(d), Explanation). Those Guidelines are not covered in this article.

Foreign investors

Foreign investors subscribe from abroad under the ticket, accredited and investor-count rules above. No residence or nationality condition on investors was found in the FM Regulations; screening comes through AML/CFT and KYC. Sovereign and other government-related investors are deemed accredited (accredited investor circular, para 1(f)(i)).

If the fund will buy listed Indian securities, it must register with SEBI as an FPI, as IFSCA’s circular of 2 May 2024 (para 1) records. The FPI rules limit NRIs, OCIs and resident Indian individuals, and restrict resident entities, not foreign investors generally. Capital flows into and out of the IFSC are covered on the capital flows page.

NRIs and OCIs: the FPI limits

NRIs and OCIs also invest from abroad. The constraint arises only if the fund is an FPI. NRIs, OCIs and resident Indian individuals may be FPI constituents only if (Reg. 4(c), FPI Regulations 2019, as amended to 7 July 2026):

each contributes below 25% of the corpus;
together they contribute below 50% of the corpus;
resident individuals invest through the LRS, and only in global funds whose Indian exposure is less than 50%;
they are not in control of the FPI.

These conditions were written into the regulation from 26 June 2024. A proviso switches off condition 2 for an FPI “regulated by the International Financial Services Centres Authority and based in the International Financial Services Centres” (Reg. 4(c), proviso). SEBI’s circular of 27 June 2024 calls this “up to hundred percent aggregate contribution”. It added para 1(ii)(e) to Part A of the FPI Master Circular. The fund first declares to its designated depository participant (DDP) that it intends to have such money of 50% or more. It then uses one of two routes:

	Route 1: disclosure	Route 2: diversified fund
Disclosure	PAN copies of every NRI, OCI and resident individual investor, with economic interest. Without a PAN, prescribed declarations plus passport, OCI card or Government ID. Look-through for non-individual investors controlled or 50%-owned by them	Not required
Structure	—	One pooled IFSC vehicle, no side vehicles; blind pool, pari-passu rights; unit classes only by currency
Limits	—	At most 20% of corpus in the equity shares of one Indian listed entity; at least 20 investors, none above 25%
Manager	—	AMC of a SEBI mutual fund sponsored by an RBI-regulated bank, or its IFSC subsidiary or branch

(Para 1(ii)(e)(ii)–(v), Part A, FPI Master Circular, as inserted on 27 June 2024.) Route 2 gives three months from registration to meet its limits. Because of the manager condition, it is in practice open only to bank-sponsored mutual fund groups, so other managers use Route 1. IFSCA’s circular of 2 May 2024 words the Route 2 test as 20% of AUM in “the securities of a single investee company” (para 3(e)); both formulations are relevant.

The IFSC proviso switches off only condition 2; on the text, conditions 1, 3 and 4 still apply. Reg. 4(c) also has a later proviso that disapplies condition 2 for a SWAGAT-FI (w.e.f. 1 June 2026), and one that keeps in force the Board’s existing exemptions as they stood on the date of the 2024 amendment. A DDP’s view is typically sought before an India-focused fund is marketed to diaspora investors.

Resident individuals: the LRS

Authorised dealers may allow resident individuals to remit up to USD 2,50,000 per financial year for permitted current or capital account transactions (para 1, LRS Master Direction, updated to 6 September 2024). OPI and ODI under the OI Rules are permitted capital account transactions (para 6). They count against the LRS ceiling (Sch. III para 1(1), OI Rules 2022).

RBI’s A.P. (DIR Series) Circular No. 15 of 10 July 2024 (RBI/2024-25/49) put IFSCs on a par: Authorised Persons may facilitate remittances to IFSCs “for all permissible purposes under LRS” for financial products and services under the IFSCA Act, 2019. It is now para 11 of the LRS Master Direction. A resident may also contribute “to an investment fund or vehicle set up in an IFSC as OPI” (Sch. V para 1(2) proviso (iii), OI Rules 2022).

Fund units and company shares are treated differently. Units of an IFSC fund are OPI (Sch. V para 1(2) proviso (iii); OI Directions para 24(1)). Acquiring equity in an IFSC company, such as an FME or a family vehicle, is ODI, with different conditions. If the fund is an FPI, a resident individual’s LRS contribution must also meet FPI Reg. 4(c)(iii): global funds with Indian exposure below 50%. The IFSC proviso disapplies only the aggregate cap, not this condition.

What the manager should know:

PAN is mandatory for the remitter (para 16).
No clubbing. Family members cannot club limits for an investment unless they are co-owners (para 4). A joint subscription has to fit each person’s own limit.
180 days. What must come back within 180 days is received, realised, unspent or unused foreign exchange that is not reinvested, not the investment itself. A continuing permitted investment need not be redeemed, and income may be retained and reinvested (para 17).
TCS. The bank collects tax on “Remittance under the Liberalised Remittance Scheme of an amount or aggregate of the amounts exceeding ten lakh rupees”, at 20% “for purposes other than education or medical treatment” (s. 394(1), Table Sl. No. 7, Income-tax Act 2025, as amended by Finance Act 2026, s. 85). The Income Tax Department’s TCS Rates page states 20% “of amount remitted in excess of Rs. 10 lakh” for purposes other than education or medical treatment. The s. 394 Table wording does not itself say “in excess”. Exceptions are in s. 394(4)-(5).

Indian companies, LLPs and partnership firms: OPI

An “Indian entity” under the OI Rules is a company, a body corporate, an LLP or a registered partnership firm (r. 2(1)(j)). Its investment in an IFSC fund is OPI: “a person resident in India, being an Indian entity or a resident individual, may make investment (including sponsor contribution) in units or any other instrument… issued by an investment fund or vehicle set up in an IFSC, as OPI” (para 24(1), OI Directions 2022). RBI’s A.P. (DIR Series) Circular No. 09 of 7 June 2024 substituted that paragraph and added that “unlisted Indian entities also may make such investment in IFSC”.

The main limit is net worth. An Indian entity’s OPI “shall not exceed fifty percent of its net worth as on the date of its last audited balance sheet” (Sch. II para 1(1), OI Rules). For managers, two practical points follow:

FPI status. If the fund is an FPI (see the NRI and OCI section), FPI Reg. 4(c) admits a resident that is not an individual as a constituent of an IFSC AIF or retail scheme only if it is the fund management entity or its associate, up to 10% of the corpus (AIF) or of AUM (retail scheme). An unrelated Indian company or LLP is not within that proviso, so the FEMA route alone does not settle eligibility for an FPI fund.
Sponsor commitment. An Indian parent’s sponsor contribution in units is expressly OPI (para 24(1)). Capital into the IFSC fund management entity itself is a separate question; IFSCA’s set-up workflow refers to “ODI-Capital and Funds Infusion” for the IFSC unit.
Partnership firms. A registered firm is an Indian entity and can use OPI. The LRS is “not available to corporates, partnership firms, HUF, Trusts” (LRS MD para 1).

FEMA is covered more broadly on the GIFT City FEMA page.

Trusts and HUFs

The LRS is not available to resident trusts and HUFs (LRS MD para 1). Neither is an “Indian entity” (r. 2(1)(j)), and para 24(1) of the OI Directions covers only Indian entities and resident individuals. Schedule V’s wider wording (“a person resident in India”) could be read to include them, but no confirmation was found. There is therefore no established ordinary route for a resident trust or HUF, and subscriptions should not be accepted from them without a separately established legal basis.

These FEMA limits concern persons resident in India. Foreign trusts and family structures still need to pass the accredited test if subscribing below the ticket size. An IFSC Family Investment Fund is deemed accredited (para 1(f)(vi)); see Family Investment Fund in GIFT City.

Investor tax, in one paragraph

Schedule VI of the Income-tax Act 2025 exempts a unit holder’s income from a “specified fund” (Sch. VI, Table Sl. No. 9). As amended by the Finance Act 2026 (s. 125), a specified fund is an IFSC Category III AIF, retail scheme or ETF whose units, other than the sponsor’s or manager’s, are all held by non-residents. A 5% allowance covers holders who later become resident (Note 1(g)). The exemption is therefore built for non-resident investors. Fund-level and investor tax are covered in GIFT City Tax Benefits for Funds and Fund Managers.

What a manager typically checks before accepting a subscription

Investor type: foreign, NRI/OCI, resident individual, Indian entity, trust or HUF.
Ticket and count: the scheme minimum, or accredited status verified under the manager’s written policy, and the scheme’s investor cap.
FPI position: if the fund invests in listed Indian securities, the 25% and 50% tests or the IFSC route and DDP declaration; for an Indian entity, whether it is the FME or its associate within the 10% limit.
Route evidence for Indian money: for an individual, that the remittance came under LRS. For an Indian entity:
1. the exact legal entity that will subscribe;
1. its latest audited net worth and the 50% OPI limit;
1. any other OPI it already holds;
1. the authorised dealer bank’s documents, and reporting (reg. 10(3), OI Regulations 2022: half-yearly, within 60 days of the half-year end);
1. the fund’s FPI status and the constituent limits above.
KYC/AML: completed under IFSCA’s AML/CFT norms, with records kept for eight years.

Common questions

How can an NRI invest in a GIFT City fund? Directly from abroad, subject to the scheme’s ticket size. If the fund is an FPI, NRIs and OCIs are capped below 25% each, and below 50% in total unless the fund uses SEBI’s IFSC route, which lifts only the aggregate cap.

Can a resident Indian invest in a GIFT City fund? Yes, under the LRS, within USD 250,000 per financial year in total (LRS MD paras 1, 11).

Can an Indian company invest in a GIFT City fund? Yes, as OPI, within 50% of its net worth. Unlisted companies can do so since RBI’s circular of 7 June 2024.

Can a family trust or HUF in India invest? It cannot use the LRS, and there is no established ordinary route for it. Subscriptions should not be accepted without a separately established legal basis.

Sources

IFSCA (Fund Management) Regulations, 2025, as amended up to 10 September 2026 (consolidated): Regs. 2(1)(d), 2(1)(ff), 20, 32, 44, 47, 77, 109, 119, Third Schedule. IFSCA, 14 Sep 2026. ifsca.gov.in
Accredited Investors in IFSC (F. No. IFSCA-IF-10PR/1/2023-Capital Markets). IFSCA, 25 Jan 2024. ifsca.gov.in
FAQs on IFSCA (Fund Management) Regulations, 2025 (Q178). IFSCA, 3 Aug 2026. ifsca.gov.in
Facilitating investments by NRIs and OCIs into Indian securities through Schemes / Funds in an IFSC (F. No. IFSCA-IF-10PR/2/2024-Capital Markets). IFSCA, 2 May 2024. ifsca.gov.in
SEBI (Foreign Portfolio Investors) Regulations, 2019 (as amended up to 7 Jul 2026), Reg. 4(c). SEBI. sebi.gov.in
SEBI (Foreign Portfolio Investors) (Second Amendment) Regulations, 2024 (SEBI/LAD-NRO/GN/2024/185). SEBI, Gazette 26 Jun 2024. sebi.gov.in
Participation by NRIs, OCIs and Resident Indian individuals in SEBI registered FPIs based in IFSCs in India (SEBI/HO/AFD/AFD-POD-2/P/CIR/2024/89). SEBI, 27 Jun 2024. sebi.gov.in
Master Circular for FPIs, DDPs and Eligible Foreign Investors (SEBI/HO/AFD/AFD-PoD-2/P/CIR/P/2024/70). SEBI, 30 May 2024. sebi.gov.in
Master Direction – Liberalised Remittance Scheme (FED Master Direction No. 7/2015-16), updated to 6 Sep 2024, paras 1, 4, 6, 11, 16, 17. RBI. rbi.org.in
Remittances to IFSCs under the LRS (A.P. (DIR Series) Circular No. 15, RBI/2024-25/49). RBI, 10 Jul 2024. rbi.org.in
Foreign Exchange Management (Overseas Investment) Rules, 2022 (G.S.R. 646(E)), r. 2(1)(j); Sch. II para 1(1); Sch. III para 1(1); Sch. V para 1(2). Ministry of Finance (DEA), 22 Aug 2022. rbi.org.in ; also incometaxindia.gov.in
Foreign Exchange Management (Overseas Investment) Directions, 2022 – Investments in Overseas Funds (A.P. (DIR Series) Circular No. 09, RBI/2024-25/41), substituting para 24(1) of the OI Directions. RBI, 7 Jun 2024. rbi.org.in
Step-by-step workflow for setting up in IFSC on the SWIT portal (v1.0). IFSCA, 7 Jul 2026. ifsca.gov.in
Income-tax Act, 2025, section 394, as amended by Finance Act, 2026, s. 85. Income Tax Department. incometaxindia.gov.in
Income-tax Act, 2025, Schedule VI, read with Finance Act, 2026, s. 125. Income Tax Department. incometaxindia.gov.in
TCS Rates (LRS, Category 4, notes (a)-(b)). Income Tax Department, page uploaded 30 April 2026. incometaxindia.gov.in
Foreign Exchange Management (Overseas Investment) Regulations, 2022 (FEMA 400/2022-RB), reg. 10(3). RBI, 22 Aug 2022. rbi.org.in

Who Can Invest in a GIFT City Fund: A Manager’s Guide