IFSCA Seeks Unified Commodity Trading Rules at GIFT City as India Targets Onshore Price Discovery

The International Financial Services Centres Authority (IFSCA) has proposed changes to the regulatory framework for commodity trading at GIFT City to attract foreign investors and bring more trading activity onshore, as per news reports. 

In August 2026, the regulator submitted proposals to classify commodities as financial products under the IFSCA Act.  

The changes require government approval and are intended to bring different forms of commodity derivatives trading under a common regulatory framework. 

Gold and Silver Imports Through GIFT IFSC 

GIFT International Financial Services Centre (GIFT IFSC) has facilitated imports of 110 tonnes of gold and 1,200 tonnes of silver through its international trade exchange framework. 

The regulator's latest proposals seek to expand the scope of commodity trading in the financial centre. The planned framework would cover exchange-traded and over-the-counter (OTC) commodity derivatives under a single regulatory structure. 

Focus on Onshore Price Discovery 

India is among the world's largest consumers of major commodities, but price discovery has historically taken place in offshore markets.  

IFSCA aims to increase trading activity within GIFT City by allowing greater participation from foreign funds and international trading firms. 

The proposed changes are intended to provide these participants with a common set of rules for commodity derivatives trading. Higher participation could also increase liquidity and support price discovery within the domestic market. 

Recent Regulatory Developments 

In September 2026, IFSCA notified the Prohibition of Market Abuse in Securities Markets Regulations, 2026, consolidating rules on market abuse in GIFT City. 

The commodity trading proposals form part of the regulator's wider work on the financial centre's regulatory framework. Their implementation will depend on government approval and any legislative or statutory amendments required under related financial regulations. 

Challenges Ahead 

The pace of implementation will depend on the time taken to secure the necessary approvals and bring international trading firms into the market. Building sufficient liquidity may also take time. 

Differences between domestic regulations and the rules followed by international financial centres remain another issue for the regulator. 

Read More: IMF Raises India’s GDP Growth Forecast to 7% for FY27! 

Conclusion 

IFSCA's proposals seek to bring commodity derivatives under a unified framework at GIFT City and increase foreign investor participation. Government approvals, regulatory changes and the pace of trading activity will determine how the plans progress. 

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