Non-Resident Indians (NRIs) and other eligible overseas investors will now have a new route to gain exposure to India’s mutual fund market through a US-dollar-denominated fund launched at GIFT City.
The Wealth Company has launched the The Wealth Company IFSC Fund of Funds (FoF) at Gujarat International Finance Tec-City’s International Financial Services Centre (IFSC). The fund is structured as an open-ended Category III Alternative Investment Fund (AIF) and will invest in a portfolio of Indian mutual funds and exchange-traded funds (ETFs).
The structure is designed to simplify investing for eligible non-resident investors who want exposure to Indian financial markets without having to select and manage individual Indian mutual fund schemes themselves.
What is the new GIFT City fund?
The Wealth Company IFSC FoF is a fund-of-funds based in GIFT City’s IFSC.
Instead of an NRI directly purchasing several Indian mutual fund schemes, the investor buys units of the GIFT City FoF. The fund manager then decides which underlying mutual funds and ETFs should form part of the portfolio.
NRI / Overseas Investor
↓
The Wealth Company IFSC FoF
↓
Indian Mutual Funds
+
Indian ETFs
↓
Diversified India exposure
The fund is managed by the IFSC branch of Wealth Company Asset Management, which is registered with the International Financial Services Centres Authority (IFSCA).
Why is this important for NRIs?
Investing in India from overseas can involve several layers of complexity.
An NRI may have to deal with:
- Eligibility requirements
- Documentation
- Currency conversion
- Taxation
- Regulatory requirements
- Selection of mutual funds
- Monitoring and rebalancing investments
India’s mutual fund industry has also grown dramatically, making fund selection increasingly complicated.
According to Business Standard, the industry had nearly 28 crore investor folios, while the mutual fund industry’s AUM stood at ₹82.22 lakh crore as of June 30, 2026, compared with ₹13.81 lakh crore a decade earlier.
The new fund attempts to simplify this process by putting the selection and allocation decisions in the hands of a professional fund manager.
How does the fund work?
The fund will invest across India’s broader mutual fund and ETF universe rather than asking investors to select individual schemes.
The Wealth Company says its selection process will consider factors such as:
- Historical performance
- Risk measures
- Quantitative parameters
- Relative performance
- Fund-manager positioning
- Market conditions
The portfolio may include diversified equity funds, sectoral strategies, fixed-income funds, hybrid funds, gold and silver ETFs, index strategies and Specialised Investment Funds (SIFs), subject to the fund’s mandate.
Fund manager
↓
Analyses funds
↓
Selects schemes
↓
Allocates across categories
↓
Rebalances portfolio
↓
NRI gets one consolidated investment
This means the investor does not have to independently track India’s large mutual fund universe.
The fund is denominated in US dollars
One of the key features is that the fund is denominated in US dollars.
For an NRI earning and holding wealth in dollars, this could make the investment process more convenient than directly dealing with rupee-denominated investment products.
NRI's foreign-currency wealth
↓
US dollars
↓
GIFT City FoF
↓
Indian mutual funds / ETFs
The dollar denomination does not mean the underlying investments are free from Indian-market or currency-related risks. The underlying portfolio remains exposed to Indian assets and their performance.
Who can invest?
The fund is not available to every overseas investor.
According to The Wealth Company, it is intended for eligible:
- NRIs
- Global family offices
- Institutional investors
- Accredited investors
- HNIs
- UHNIs
Resident Indians cannot invest in the fund.
The fund also currently excludes investors who are residents of the United States and Canada, as well as investors from jurisdictions restricted under applicable FATF rules.
This restriction is particularly relevant because US- and Canada-based NRIs can face additional regulatory and tax complexities when investing in Indian financial products.
NRIs do not have to select individual mutual funds
This is one of the biggest differences between the new GIFT City structure and direct mutual fund investing.
Under the FoF model:
Investor → GIFT City FoF → Underlying mutual funds and ETFs
The investor therefore outsources the underlying fund-selection and allocation decisions to the professional manager.
For an overseas investor who wants diversified exposure to India but does not want to monitor hundreds or thousands of schemes, this could be a major convenience.
India has more than 1,600 mutual fund schemes
The scale of India’s mutual fund market itself makes fund selection difficult.
The Wealth Company says there are more than 1,600 schemes available to investors, with different investment styles and strategies.
For an NRI living thousands of kilometres away from India, tracking individual schemes, fund managers and market cycles can be time-consuming.
The new FoF attempts to address this problem by providing a single professionally managed portfolio.
1,600+ schemes
↓
Selection challenge
↓
Professional fund manager
↓
One diversified FoF
Is this the same as buying a mutual fund?
No.
This distinction is important.
The GIFT City product is a Category III AIF, not a conventional Indian mutual fund.
Although the AIF may invest in Indian mutual funds and ETFs, the investor purchases units of the AIF itself.
| Feature | Direct Indian MF | GIFT City FoF |
|---|---|---|
| Structure | Mutual fund | Category III AIF |
| Investor | Eligible MF investors | Eligible non-resident/global investors |
| Currency | Generally INR | US-dollar denominated |
| Fund selection | Investor chooses | Fund manager chooses |
| Underlying assets | Mutual fund portfolio | Indian MFs/ETFs and permitted strategies |
| Management | Individual AMC | FoF manager |
| Suitable for | Broad retail market | More sophisticated eligible investors |
The different structure also means investors should examine the fund’s fees, expenses, liquidity and investment mandate carefully.
What are the potential advantages?
The new fund offers several potential advantages for eligible overseas investors.
1. Dollar-denominated investment
NRIs who earn and hold money in US dollars may find a dollar-denominated structure more convenient.
2. Professional fund selection
The investor does not have to select individual Indian mutual funds.
3. Diversified India exposure
The fund can allocate across multiple mutual fund categories and ETFs.
4. GIFT City framework
The fund operates through India’s international financial services centre.
5. Simplified execution
Instead of managing multiple mutual fund investments, an investor can use a single FoF structure.
Dollar investment
+
Professional selection
+
Diversification
+
GIFT City IFSC
↓
Simplified India exposure
What about taxation?
Tax treatment is likely to be one of the most important considerations for prospective investors.
The Wealth Company says the fund is structured as an IFSC-based Category III AIF and is expected to qualify as a “Specified Fund” under the applicable provisions of the Income-tax Act, 2025, subject to meeting prescribed conditions.
Under the tax framework cited by the company, specified income of a qualifying fund attributable to eligible non-resident unit holders may receive an exemption from Indian income tax, subject to applicable conditions.
However, investors should not assume that investing through GIFT City automatically makes their investment tax-free.
The tax treatment can depend on:
- The fund meeting statutory conditions
- The investor’s circumstances
- The investor’s country of residence
- Local tax rules
- DTAA provisions
An NRI living in the UAE, for example, could have a different tax position from an NRI living in the UK, Singapore or Australia.
Country of residence still matters
The fact that the fund is based in India does not mean the investor’s home country will ignore the investment.
For example:
NRI in UAE
↓
GIFT City FoF
↓
Indian assets
↓
Indian + UAE tax considerations
NRI in UK
↓
GIFT City FoF
↓
Indian assets
↓
Indian + UK tax considerations
Therefore, investors should seek independent tax advice before investing, including advice on local taxation and applicable Double Taxation Avoidance Agreement provisions.
GIFT City is becoming a gateway for global capital
The launch is part of a broader effort to establish GIFT City as an international financial centre.
GIFT City operates an IFSC framework designed to provide financial services for international investors and institutions.
IFSCA data cited by Business Standard shows that cumulative commitments raised by funds operating in the IFSC had crossed $39 billion as of March 2026.
Global investors
↓
GIFT City IFSC
↓
Indian + global financial products
↓
International capital
The objective is to create an ecosystem where global investors can access investment opportunities through an India-based international financial centre.
Why GIFT City matters for NRIs
For decades, NRIs wanting exposure to India have often had to navigate domestic financial systems from overseas.
GIFT City could increasingly provide an alternative route.
The broader proposition is:
Global capital → GIFT City → Indian investment opportunities
This could become increasingly important as India’s economy and financial markets grow.
India’s mutual fund market is getting bigger
The new product arrives at a time when India’s mutual fund industry is expanding rapidly.
Mutual fund AUM reached ₹82.22 lakh crore in June 2026, compared with ₹13.81 lakh crore a decade earlier.
That represents an almost six-fold increase over 10 years.
June 2016
₹13.81 lakh crore
↓
June 2026
₹82.22 lakh crore
↓
Nearly 6X growth
The growth makes India increasingly attractive to overseas investors seeking exposure to the country’s expanding financial markets.
SIP investments are also growing
India’s SIP ecosystem has expanded alongside mutual fund AUM.
Monthly SIP contributions stood at ₹31,781 crore in June 2026, according to AMFI data cited by Business Standard.
This demonstrates the depth of India’s domestic investment base.
Retail investors
↓
Monthly SIPs
↓
₹31,781 crore
↓
Mutual fund industry
↓
₹82.22 lakh crore AUM
The growing domestic market could make India increasingly attractive to NRIs looking for long-term exposure to the country’s economy.
What can the fund invest in?
The fund has a relatively broad potential investment universe.
It can include, subject to its mandate:
| Investment category | Potential exposure |
|---|---|
| Diversified equity funds | Indian equities |
| Sector funds | Specific industries |
| Fixed-income funds | Debt securities |
| Hybrid funds | Equity + debt |
| Gold ETFs | Gold |
| Silver ETFs | Silver |
| Index strategies | Market indices |
| SIFs | Specialised investment strategies |
This allows the fund manager to change allocation depending on market conditions and the fund’s investment strategy.
Professional management does not guarantee better returns
Investors should not confuse professional management with guaranteed performance.
The fund manager will make investment decisions, but the underlying investments can still lose value.
Professional management
≠
Guaranteed returns
The portfolio may be exposed to:
- Equity-market volatility
- Interest-rate movements
- Credit risk
- Commodity-price movements
- Currency movements
- Market corrections
The value of the investment can rise or fall depending on the underlying assets.
There is an additional layer of costs
Because the structure is a fund-of-funds, investors should understand that there can be costs at more than one level.
The investor puts money into the FoF.
The FoF then invests in underlying mutual funds and ETFs.
Investor
↓
FoF
↓
Underlying mutual funds / ETFs
This additional structure makes it particularly important to examine:
- Management fees
- Fund expenses
- Underlying fund expenses
- Transaction costs
- Exit or liquidity provisions
- Other charges
Business Standard specifically advises investors to look beyond the dollar denomination and potential tax benefits and assess the fund’s fees, expenses, liquidity, mandate and underlying investments.
Liquidity is another factor to examine
AIFs do not necessarily operate in exactly the same way as conventional mutual funds.
Therefore, prospective investors should understand the fund’s redemption terms and liquidity provisions before investing.
The fact that a fund invests in liquid mutual funds or ETFs does not automatically mean the investor can redeem the FoF units under the same conditions as a conventional open-ended mutual fund.
This is an important distinction for investors who may need their money at short notice.
Who could find this structure useful?
The product could be particularly relevant to an NRI who:
- Wants long-term exposure to India
- Holds wealth in US dollars
- Does not want to select individual Indian funds
- Wants professional portfolio management
- Meets the eligibility requirements
- Is comfortable with an AIF structure
- Understands the associated costs and risks
NRI
+
India investment conviction
+
Dollar wealth
+
Preference for professional management
+
Eligible investor
↓
GIFT City FoF could be relevant
It may be less suitable for an investor who prefers complete control over individual mutual fund selections or needs highly liquid, simple retail investment products.
GIFT City could attract more NRI products
The launch could encourage more financial institutions to develop products specifically for overseas Indians.
If demand grows, GIFT City could eventually host a broader range of:
- India-focused funds
- Global funds
- Family investment structures
- Portfolio-management solutions
- Alternative investments
- Wealth-management products
More global investors
↓
More demand
↓
More GIFT City products
↓
Deeper IFSC ecosystem
This could strengthen GIFT City’s position as India’s gateway for international capital.
The broader opportunity for India
The importance of the new fund extends beyond individual NRIs.
India wants to attract more global capital while strengthening its domestic financial infrastructure.
GIFT City provides a platform through which international investors can access financial products within an Indian international financial centre.
The more successful these structures become, the greater the potential for India to capture financial activity that might otherwise take place in overseas centres.
What NRIs should check before investing
Before investing, an NRI should carefully evaluate:
Eligibility
Confirm that their country of residence and investor category are permitted.
Taxation
Understand both Indian and home-country tax treatment.
Fees
Check the FoF’s management and other expenses, as well as costs at the underlying fund level.
Investment mandate
Understand how the fund can allocate money.
Risk
Check the potential exposure to equity, debt, commodities and other assets.
Liquidity
Understand redemption and exit terms.
Currency
Understand how the dollar denomination interacts with the performance of rupee-based underlying assets.
BEFORE INVESTING
Eligibility
↓
Tax
↓
Fees
↓
Mandate
↓
Risk
↓
Liquidity
↓
Currency exposure
Dollar denomination does not remove currency risk
A US-dollar-denominated investment may make accounting and funding more convenient for an NRI, but it does not necessarily eliminate currency risk.
The underlying Indian investments can still be influenced by movements in the Indian rupee against the US dollar.
For an investor measuring wealth in dollars, the ultimate return can therefore depend on both:
Indian asset performance + currency movement.
Indian market return
+
INR/USD movement
↓
Investor's dollar return
This is particularly important for investors whose financial goals and expenses are primarily in foreign currency.
Why the launch comes at an important time
India’s financial markets are becoming significantly larger and more sophisticated.
The mutual fund industry has expanded nearly sixfold in a decade, SIP contributions have reached tens of thousands of crores every month, and India’s capital markets have attracted growing participation from domestic investors.
The next logical step is increasing international participation.
Domestic savings
+
Global capital
↓
Indian financial markets
↓
Larger investment ecosystem
GIFT City’s international framework could become an important part of this process.
Key takeaways
1. The Wealth Company has launched an IFSC-based Fund of Funds in GIFT City for eligible non-resident investors.
2. The fund is structured as an open-ended Category III AIF.
3. It will invest in a portfolio of Indian mutual funds and ETFs rather than requiring investors to select individual schemes themselves.
4. The fund is denominated in US dollars, which may make it more convenient for NRIs whose wealth is held in dollars.
5. Eligible NRIs, global family offices, institutions, accredited investors and HNIs/UHNIs are among the intended investors.
6. Resident Indians cannot invest in the fund, and investors resident in the US and Canada are currently excluded.
7. The fund is not the same as a conventional Indian mutual fund; investors purchase units of the Category III AIF.
8. The Wealth Company says the fund may qualify as a Specified Fund under applicable tax provisions, subject to prescribed conditions, but investors should not assume the investment is automatically tax-free.
9. Investors must consider their country of residence, local taxation and applicable DTAA provisions before investing.
10. The launch is part of GIFT City’s broader effort to attract international capital and establish itself as a gateway for global investors seeking Indian exposure.
Conclusion
The launch of The Wealth Company’s US-dollar-denominated IFSC Fund of Funds marks another step in GIFT City’s evolution as a gateway for international investors seeking exposure to India.
For eligible NRIs, the proposition is relatively straightforward: instead of navigating India’s large mutual fund universe and selecting individual schemes, investors can put money into a professionally managed FoF that allocates across Indian mutual funds and ETFs.
The dollar denomination could make the structure particularly convenient for NRIs who earn and hold their wealth in US dollars.
But the product should not be viewed simply as a “new mutual fund for NRIs.”
It is a Category III AIF, which means its structure, fees, liquidity and regulatory framework differ from those of conventional Indian mutual funds.
That distinction is important.
The tax proposition may also be attractive in certain circumstances, but investors should not interpret GIFT City as an automatic tax-free route.
Tax treatment depends on statutory conditions as well as the investor’s country of residence and local tax rules.
The investment also carries market risk.
Although the fund manager selects and manages the underlying portfolio, the fund can still be affected by Indian equity markets, debt markets, commodities and currency movements.
The dollar denomination makes the investment easier to fund and measure for some overseas investors, but it does not eliminate currency or investment risk.
For India, however, the significance of the launch is broader.
The country’s mutual fund industry has grown from ₹13.81 lakh crore of AUM in June 2016 to ₹82.22 lakh crore in June 2026, while monthly SIP contributions have crossed ₹30,000 crore.
As India’s financial markets grow, attracting a larger share of global Indian wealth could become increasingly important.
GIFT City is attempting to provide the infrastructure for that shift.
If more fund managers launch India-focused products for overseas investors through the IFSC, GIFT City could become an increasingly important bridge between Indian assets and global capital.
For NRIs, the new fund therefore represents more than another investment option.
It is part of a broader change in how overseas Indians may access India’s growing financial markets — through a structure designed around global currency, professional management and India’s international financial centre.
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