Vivek Parashar
January 3, 2025
In a significant development that aligns with New Zealand’s growing economic ties with India, Kiwi investors now have unprecedented access to India’s robust financial markets, marking a historic shift in cross-border investment opportunities.
Investing in the world’s fastest-growing economy has always been incredibly challenging, until now for New Zealand investors.
India’s Economic Promise
As India positions itself to become the world’s third-largest economy by 2030, the timing could not be better for New Zealand investors looking to diversify their portfolios.
With a GDP of US$ 3.5 trillion and consistently strong growth rates, India presents a compelling investment destination, particularly for New Zealand’s 300,000-strong Indian Diaspora and savvy local investors looking for an edge.
Traditionally, investing in Indian markets has been a complex endeavour for overseas investors, particularly for retail investors.
The challenges have been numerous: (a) the Requirement for an Indian bank account: Necessitates extensive paperwork and in-person verification (b) Complex tax implications including capital gains calculations across two jurisdictions (c) the Need for a Permanent Account Number (PAN) card and demat account (d) High foreign exchange fees including complicated remittance procedures involved (e) Annual tax filing requirements- Necessary in India, even for small investments (f) Multiple KYC processes: Required across different financial institutions.
GIFT City: A New Gateway
The recent regulatory changes through Gujarat International Finance Tec-City (GIFT City) have created a landmark opportunity for international investors.
The GIFT City represents India’s vision for a world-class international financial centre.
India’s first International Financial Services Centre (IFSC) opens exciting opportunities for the Indian Diaspora to grow their wealth alongside India’s booming economy: (1) Save on taxes with exemptions on capital gains (2) Invest easily- no need for a PAN card or Indian bank account (3) Hassle-free repatriation of funds without needing NRE/NRO accounts (4) Stay secure with strong international compliance under IFSCA regulations.
It is simple, efficient, and built for global Indians.
Unfortunately, the minimum investment amount for most funds is US$ 150,000 per retail investor and is limited to a select few funds. For investors who are looking to invest smaller amounts directly from New Zealand, alternative pathways have emerged to democratize access to Indian markets.
Innovation Bridges the Gap
While GIFT City opens new avenues, innovative fintech solutions based in New Zealand are making Indian market access more accessible for everyday Kiwi investors.
Indus, New Zealand’s first SEBI-licensed platform for Indian market investments, is one such solution that allows New Zealand residents to invest in Indian mutual funds in as little as three minutes with no Indian Bank account.
“The traditional barriers to investing in India have been complex regulations and cumbersome processes,” Jai Goradia, Founder of Indus and long-time resident of Auckland said.
“With new regulatory innovations from the Indian government, we were able to build Indus which helps change a months-long paper-heavy process into a three-minute digital journey similar to a Sharesies but aimed at the Indian Market. New Zealand residents can now simply deposit, invest, and easily withdraw directly – a reality we always wanted to see,” he said.
Indus leverages India’s new direction of inviting more foreign investment and handles all the complexity behind the scenes, including (a) Investing directly from New Zealand with no Indian Bank Account (b) Seamless KYC verification using NZ identification (c) Automated tax calculations and compliance (d) Direct NZD to INR currency conversion at superior rates.
Looking Ahead
The opening of Indian markets to New Zealand investors represents more than just a new investment avenue – it is a testament to the growing economic partnership between both nations. As New Zealand looks to diversify its economic relationships in 2024 and beyond, closer financial ties with India could prove strategically valuable for investors seeking growth opportunities in Asia’s rising economic powerhouse.
Vivek Parashar is a Founder-Director of Indus, stated to be New Zealand’s first licensed platform for Indian market access. The company is based in Auckland.
Website: Indus.nz
