IFSCA Releases Expert Committee Roadmap for REITs and InvITs in GIFT IFSC
The International Financial Services Centres Authority (IFSCA) has released the Report of the Expert Committee on Development of REITs and InvITs in IFSC, submitted on July 13, 2026 by a Committee chaired by Mr. Ananta Barua (former Whole Time Member, SEBI) and released via press note on July 15, 2026. The report sets out a roadmap for positioning GIFT IFSC as an international hub for real estate and infrastructure financing, through regulatory reform, product innovation, tax competitiveness and inter-regulatory coordination.
Background
India needs an estimated USD 4.5 trillion in infrastructure investment by 2040, while its real estate sector is projected to reach USD 5.8 trillion by 2047. SEBI-regulated REITs and InvITs have mobilised approximately ₹2 lakh crore since FY 2019-20. The Committee’s view is that GIFT IFSC can serve as an additional gateway for global institutional capital into these sectors, backed by a globally competitive regulatory and tax framework.
Key Recommendations
1. Product Innovation
- Introduction of Mortgage REITs (mREITs) as an alternative real estate financing channel and to support development of the securitisation market.
- Extension of IFSCA’s existing anti-greenwashing principles (currently applicable to ESG-labelled debt securities) to REITs and InvITs that market themselves as “green.”
- A calibrated, wait-and-watch approach to Small and Medium REITs (SM REITs), IFSCA to monitor SEBI’s domestic SM REIT framework and its own tokenisation initiatives before considering a similar regime in IFSC.
2. Regulatory Amendments (IFSCA (Fund Management) Regulations, 2025)
- New concepts of Inducted Sponsors, Re-Designated Sponsors, and Self-Sponsored Investment Managers, to enable sponsor exit/entry and consolidation of sponsor and manager roles.
- Fast Track Rights Issues, allowing established trusts to raise further capital without filing a draft offer document.
- A framework for issuance of Subordinate Units to sponsors.
- Establishment of an Investor Protection Fund.
3. Inter-Regulatory Measures
- Exemption of investments by IFSC REITs/InvITs into Indian entities from sectoral caps and the three-year lock-in requirement under the automatic route (FEMA/NDI Rules).
- Exemption of Indian sponsors of IFSC investment trusts from the 50%-of-net-worth Overseas Portfolio Investment (OPI) limit.
- Enabling SEBI-registered REITs and InvITs to access GIFT IFSC exchanges via depositary receipts and dual/secondary listing, and this requires SEBI to enable the corresponding mechanism; inter-regulatory dialogue between IFSCA and SEBI is stated to be underway.
4. Taxation
- Tax parity between IFSCA-registered and SEBI-registered REITs/InvITs, via an amendment to the definition of “business trust” under section 2(21) of the Income Tax Act, 2025.
- Exemption from taxation of foreign-sourced income earned by non-resident unitholders from the offshore investments of an IFSCA-registered REIT/InvIT (an amendment to Schedule V, Sl. no. 3), bringing treatment in line with Category I/II AIFs.
Why This Matters
The report also flags, separately from the above recommendations, that IFSC REITs/InvITs can serve two further business cases beyond channelling capital into Indian assets: “Mixed REITs” holding a multi-jurisdiction portfolio, and “Global REITs” holding wholly foreign assets, drawing a parallel to Singapore, where over 90% of S-REITs hold at least some overseas property.
The case for cross-listing is backed by the Committee’s own data on foreign participation in existing SEBI-regulated trusts: of 23 listed InvITs reviewed, 11 show direct foreign holding (including NRIs) of 0–5% in public unitholding, with National Highways Infra Trust at just 0.06%. REITs fare somewhat better, ranging from 0.7% to 42.8% across the 5 REITs reviewed. This is the evidentiary basis the Committee cites for enabling dual listing and depositary receipts as a near-term way to bring global capital to existing Indian trusts.
The Committee also considered, but deferred, Stapled REITs/InvITs recommending that resolution of the inter-regulatory and taxation issues above be prioritised first.
Next Steps
The recommendations are not yet law. IFSCA has stated it will examine the Committee’s proposals in consultation with relevant stakeholders and consider the necessary policy, regulatory and legislative measures for implementation.
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