The union cabinet on Wednesday approved a Bill to set up a unified authority for regulating all financial services in international financial services centres (IFSCs) in the country.

The first IFSC in India was set up at GIFT City in Gandhinagar, Gujarat.

Currently, banking, capital markets and insurance sectors in IFSCs are regulated by multiple regulators -- the RBI, Sebi and Irdai, respectively, Union Law Minister Ravi Shankar Prasad told reporters after the cabinet meeting.

The dynamic nature of business in the IFSCs necessitates a high degree of inter-regulatory coordination, he said while explaining the rationale behind the International Financial Services Centres Authority Bill, 2019.

An IFSC enables to bring back to India the financial services and transactions that are currently carried out in offshore financial centers by Indian corporate entities and overseas branches or subsidiaries of financial institutions (FIs).

It provides business and regulatory environment that is comparable to other leading international financial centres in the world like London and Singapore.

IFSC provides Indian companies easier access to global financial markets.

"The establishment of a unified financial regulator for IFSCs will result in providing world-class regulatory environment to market participants from an ease of doing business perspective," said an official release.

This will provide a stimulus for further development of IFSCs in India.

This would also generate significant employment in the IFSCs in particular as well as financial sector in India as a whole, the release added.

First Published:Feb 6, 2019 10:54 PM IST