New Delhi: There will be an unified authority for regulating all financial services in international financial services centres (IFSCs) in the country with the government moving the IFSC Authority Bill, 2019 in the Rajya Sabha on Tuesday.
Minister of State for Finance Shiv Pratap Shukla, who moved the Bill, said the proposed measure mandates that the transaction of financial services in the IFCS will be governed by an authority headed by a chairman.
Currently, banking, capital markets and insurance sectors in IFSCs are regulated by multiple regulators the RBI, SEBI and IRDAI and this would provide inter-regulatory coordination.
The proposed legislation has a provision for the establishment and incorporation of the authority. Regulatory bodies, including RBI, SEBI, IRDAI, PFRDI would have one nominee as its member, while the Finance Ministry will have rights to nominate two officials in the Authority.
It will be "regulating the financial products, financial services and financial institutions in an IFSC," the Bill said.
Two members could also be appointed by the Central government on the recommendation of a selection committee.
"The chairperson and a member shall hold offices for a term of three years from the date on which he enters upon his office and shall be eligible for reappointment," the Bill said.
An IFSC enables to bring back to India the financial services and transactions that are currently carried out in offshore financial centres by Indian corporate entities and overseas branches or subsidiaries of financial institutions (FIs).
It provides business and regulatory environment comparable to other leading international financial centres in the world such as in London and Singapore.
The first IFSC in India was set up at GIFT City in Gandhinagar, Gujarat.