Mumbai, 16 March 2026: GIFT City, India’s only International Financial Services Centre (IFSC), has the potential to become a global hub for institutional gold funds if it successfully combines digital accessibility with strong legal enforceability and robust regulatory oversight, according to Artha Bharat Investment Managers.
Speaking at the Global Securities Markets Conclave organised by the International Financial Services Centres Authority (IFSCA), Sachin Sawrikar, Managing Partner at Artha Bharat Investment Managers IFSC LLP, said that global investors assessing gold funds place greater importance on legal clarity and enforceability than on returns.
Artha Bharat Investment Managers is the first fund house authorised by IFSCA to launch a gold fund from GIFT City and is among the largest fund management firms operating from the international financial centre.
Legal enforceability remains the top investor concern
According to Sawrikar, investors considering offshore gold investment structures are primarily focused on issues such as dispute resolution mechanisms, ownership rights, and the enforceability of contracts.
“From an investor’s perspective, gold acts as portfolio insurance, a macro hedge, and a stabiliser during periods of geopolitical stress. Since gold is meant to reduce portfolio risk, the investment structure itself should not introduce additional risk,” Sawrikar said.
He noted that investors evaluating gold funds in GIFT City typically focus on three key legal factors: the jurisdiction for dispute resolution, the speed of enforcement, and whether ownership of the gold backing the fund is clearly ring-fenced. These concerns become even more critical when leverage is involved.
“This is particularly important because a large share of offshore gold exposure, especially through private banks, is often leveraged. When leverage is introduced, any ambiguity around legal processes, platform stability, or ownership clarity becomes significantly magnified,” he added.
Sawrikar emphasised that investors ultimately want assurance that their ownership rights will remain protected even in extreme situations.
“The key question investors want answered is simple: if the platform or fund house were to fail tomorrow, would the investor still clearly own the underlying gold?”
Digital access must be supported by strong legal structures
Sawrikar acknowledged that technological advancements have significantly improved access to gold investments, enabling innovations such as fractionalisation, tokenisation, and seamless integration with digital wealth platforms. However, he cautioned that technology cannot substitute strong legal enforceability.
“Institutional capital scales when there is predictability, structural clarity, and confidence that investor rights can be enforced. Digitally delivered, physically backed, regulator-supervised gold funds with clear legal enforceability can position GIFT City as a global hub for gold investment,” he said.
To stand out globally, he noted, GIFT IFSC must ensure a clear separation of roles, fully allocated physical backing of gold, bankruptcy-remote fund structures, independent custody arrangements, and strong capital adequacy norms.
Caution around digital gold platforms
Artha Bharat also highlighted the need for caution when it comes to digital gold platforms. While digital gold may serve a role in tactical portfolio allocations, it must be fully allocated, independently custodied, and subject to regulatory supervision in order to gain the confidence of institutional investors.
Opportunity to create a global benchmark
According to Sawrikar, the right balance between innovation and regulatory clarity could enable GIFT City to set a global benchmark for gold investment platforms.
“Innovation attracts attention, but legal certainty and structural clarity attract leveraged institutional capital. If GIFT City combines digital efficiency with strong legal enforceability, it has the potential to establish a global benchmark in gold investment,” he said.
He concluded that GIFT IFSC has a significant opportunity to lead globally, and through its Physical Gold Fund, Artha Bharat aims to help build an ecosystem of digitally delivered, fully backed, and regulator-supervised gold fund structures that appeal to the global investor community.
