India's Union Cabinet, chaired by Prime Minister Shri Narendra Modi (pictured), has approved the International Financial Services Centres Authority Bill.

At the moment, many regulators regulate the banking, capital markets and insurance sectors in International Financial Services Centres. These are the Reserve Bank of India, the Securities and Exchange Board of India and IRDAI, the Insurance Regulatory and Development Authority. The Government believes that the dynamic nature of business in the IFSCs necessitates more inter-regulatory co-ordination than before.

It also believes this initiative to be essential if it wants to make India a jurisdiction in which it is easy to do business. Indeed, the multi-national jurisdiction has jumped 14 places to 63rd in the World Bank’s annual rankings for ease of doing business recently. The Government also thinks that a unified authority will bring India into line with the global best practices.

The Cabinet originally sent the Bill to Parliament on 6 February and it was introduced into the Rajya Sabha (upper house) by the Minister of Finance of the day. It is a Finance Bill as defined in Article 117(1) of the Indian Constitution and should be introduced in Lok Sabha accordingly with the recommendation of the President under Articles 117(1) and 274(1) of the Constitution.