Decision to set up IFSC HQ in Guj erroneous: Sharad Pawar slams Centre

In a letter to Prime Minister (PM) Narendra Modi on Sunday, Nationalist Congress Party (NCP) chief Sharad Pawar has slammed the central government’s decision to

In a letter to Prime Minister (PM) Narendra Modi on Sunday, Nationalist Congress Party (NCP) chief Sharad Pawar has slammed the central government’s decision to set up the headquarters of the International Finance Services Centre (IFSC) in Gandhinagar instead of Mumbai and termed the establishment of the centre in Gujarat’s capital as “egregious, erroneous and unwarranted.”

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In the scathing letter, a picture of which he had tweeted on Sunday, the veteran politician wrote, “It [the decision] will also be perceived as a move to shift financial institutions and business houses away from Maharashtra and will create unnecessary political disturbances. It will not only cause financial damage to the country but also bring international discredit to it by undermining the importance of Mumbai.”

The former Union minister also said that the central government receives government securities (G-sec) worth ₹5.95 lakh crore from Maharashtra against Gujarat’s contribution of ₹1.40 lakh crore. He also said that Mumbai has been recognised among the world’s top 10 centres of commerce in terms of global financial flow, generating 6.16% of India’s gross domestic product (GDP) and accounting for 25% of industrial output and 70% of capital transactions to India economy.

“If you see the general psyche of all business communities, bankers and other financial institutions, Mumbai is their natural choice for setting up such a unified authority. The Central government’s decision will be taken as an act of undermining the strategic importance of Mumbai that boasts as the nation’s financial capital,” Pawar wrote. “Even the institutions across the world will be taken a back with this shocking decision,” he added.

The former Maharashtra chief minister has also said that the PM must consider establishing IFSC in India’s financial capital.

“I expect Hon @PMOIndia to take a rational, judicious decision keeping aside the state politics and consider it as an issue of utmost national importance,” Pawar had tweeted.

The NCP chief’s reaction has come a day after former Maharashtra chief minister Devendra Fadnavis said that it was the then Congress-NCP government which is to be blamed for the move, as it did not consider the option when it first came up in 2007. Fadnavis also claimed that the previous state government, during his tenure, had submitted a proposal to the Centre to allow the functioning of two IFSCs in the country – in Mumbai and Gujarat – and added that it was still under consideration.

The Congress and Bharatiya Janata Party (BJP) units in Mumbai too have indulged in a war of words over the Centre’s decision.

Reacting to the NCP chief’s scathing letter, BJP legislator Ashish Shelar said that it is still possible to establish an IFSC in Mumbai.

“Those criticising [the Centre] today, what did you do when you were in power between 2007 and 2014?” Shelar tweeted pointing at the then Congress-NCP government in Maharashtra.

He further said, “You are in power today, start the process. Don’t just criticise.”

Congress spokesperson, Sachin Sawant, however, said that the decision to establish IFSC lies with the Central government.

“Two committee reports during the tenure of UPA [United Progressive Alliance] government suggested that IFSC must be established in Mumbai. There is no report, which talks of Gandhinagar. The decision to establish IFSC was taken by the BJP government in 2015, within a year they came into power at the Centre.”