New financial hub and fintech platforms make international investing accessible to retail investors seeking portfolio diversification
Indian investors are increasingly looking beyond domestic markets to build global portfolios, driven by currency concerns and the need for diversification. The recent Mint Horizons masterclass in Ahmedabad brought together investment experts to discuss how GIFT City and new fintech platforms are making international investing more accessible to retail investors.
The event highlighted a significant shift in Indian investment patterns. Traditional portfolios focused solely on domestic assets are giving way to globally diversified strategies. This change reflects growing awareness among investors about the benefits of international exposure and concerns about rupee depreciation.
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GIFT City, India's International Financial Services Centre, has emerged as a crucial gateway for outbound investments. Mihir Upadhyay from IFSCA explained the unique positioning: "GIFT City is an enclosure within India, but it can be treated as offshore of India. Everything in GIFT City is related to financial services."
This special status allows GIFT City to compete with established financial centers like Singapore and Hong Kong. The regulatory framework, established in 2019, aims to bring back India-related business that previously operated from overseas locations.
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Making Global Investing Accessible
Investment experts at the event shared practical strategies for building international portfolios. Jay Kothari from DSP Investment Managers pointed out a compelling statistic: "If you look at the Indian market cap, which is close to $5 trillion, you are just 4% of the global market cap. So you have another 95% to invest into."
The discussion revealed how fund managers are targeting diverse sectors globally:
- Consumer internet companies like Amazon
- Athletic brands including Nike and Lululemon
- Electric vehicle manufacturers such as BYD
- Payment system leaders like Mastercard and Visa
Ankita Pathak from Ionic Asset shared their focus on "innovation enablers" - companies in cybersecurity and cloud computing that support AI growth. She emphasized the importance of solid financials over market hype when selecting investments.
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Technology Simplifies the Process
Fintech platforms have dramatically reduced barriers to international investing. Shubh Moulik from Appreciate described how technology has transformed the process: "You can onboard in roughly three minutes and complete a transaction in roughly 15 seconds, fully digital, end-to-end."
Key Considerations for Global Investing
| Aspect | Details |
|---|---|
| Minimum Investment | Varies by platform; some funds require $5,000 |
| Forex Fees | Now at or below 1% on digital platforms |
| Transaction Charges | Single-digit rupees on fintech platforms |
| Tax on Long-term Gains | 12.5% after 2-year holding period |
| Annual Limit (LRS) | $250,000 per person |
The experts addressed common investor concerns about market timing and asset allocation. When asked about the ideal portfolio mix, Kothari noted there's no universal answer: "Based on your temperament and life goals, this answer will change. What makes you the maximum money is not just the returns... the more time you spend, it will compound."
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Beyond Returns: Strategic Benefits
Global investing offers benefits beyond financial returns. Pathak shared an example of a client who built a dollar corpus over years through the Liberalised Remittance Scheme. When the client's son needed funding for an overseas venture, the accumulated dollars provided flexibility without being constrained by annual limits.
This strategic approach helps investors prepare for future needs like international education, overseas medical treatment, or potential relocation.
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Looking Ahead
The Indian investment landscape is evolving rapidly. GIFT City continues to develop its infrastructure and attract more fund managers. Digital platforms are making the process increasingly seamless and cost-effective.
For investors considering global exposure, experts recommend starting with a clear understanding of goals and time horizons. The consensus view suggests maintaining investments for at least two years to benefit from favorable tax treatment and allow time for compounding.
As regulatory frameworks mature and technology platforms expand, accessing global markets will likely become even simpler for Indian retail investors. The shift from purely domestic portfolios to globally diversified strategies represents a fundamental change in how Indians approach wealth creation and preservation.
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