Consider the following statements with reference to the IFSCA Act:

1)    The IFSCA Act was enacted in 2019 to provide for the establishment of an authority for regulating financial services in the International Financial Services Centres (IFSCs) in India.

2)    The IFSCA Act also provides for the establishment of a unified financial regulatory authority that will oversee all financial services in India.

Select the correct answer using the code given below:

Solution

The IFSCA Act, 2019 was enacted by the Parliament to provide for the establishment of an authority to regulate financial services in the International Financial Services Centres (IFSCs) in India. The IFSCs are envisaged as international hubs for financial services, catering to customers outside the jurisdiction of the domestic economy. However, the IFSCA Act does not provide for the establishment of a unified financial regulatory authority that oversees all financial services in India. Instead, it establishes the International Financial Services Centres Authority (IFSCA) as a regulatory authority for IFSCs, with the power to regulate and develop the financial services market in IFSCs. Therefore, statement 2 is incorrect.