Artha Bharat launches GIFT City’s first physical gold fund

The scheme uses IFSCA‑regulated, IIDI‑insured vaults located in Gift City
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Artha Bharat Investment Managers IFSC LLP says it has introduced Gift City’s inaugural physical‑commodity fund and the first gold fund approved by IFSCA. The product lets investors redeem shares for either certified gold bars or cash, expanding bullion‑linked investment options at India’s global financial hub.

The Artha Bharat FinMet Physical Gold Fund will devote at least 95 % of its assets to LBMA‑approved gold bars traded on the India International Bullion Exchange (IIBX) and stored in IFSCA‑regulated, IIDI‑insured vaults in Gift City. Developed with Singapore‑based precious‑metals expert FinMet, which serves as investment adviser, the fund’s standout trait is the option to receive physical gold bars on redemption rather than cash—a feature uncommon among global commodity funds.

Investment Vehicles

The launch comes after IFSCA classified commodity trading as a financial product in January 2026, a regulatory change that lets Gift City fund managers build commodity‑linked vehicles under the IFSC framework. “Our fund will hold physical gold in IFSCA‑overseen, IIDI‑insured vaults in Gift City. Investors can also choose to receive certified gold bars or cash equal in value when they redeem,” said Sachin Sawrikar, Managing Partner of Artha Bharat Investment Managers IFSC LLP, an IFSCA‑registered manager that oversees several Category III alternative‑investment funds totaling roughly $750 million.

The fund will use IFSCA‑regulated, IIDI‑insured vaults in Gift City, providing segregated storage that diversifies away from conventional Western custodians. FinMet will advise on bullion procurement, IIBX trading rules, LBMA pricing and flows from global central banks. Weekly subscriptions and redemptions are available while the fund upholds institutional‑level custody standards.

With a total expense ratio of 0.65 %, the fund permits weekly subscriptions and redemptions, delivering liquidity more common to financial‑asset products than to physical‑commodity investments.

New Category

The initiative is also seen as a possible boost for the India International Bullion Exchange (IIBX), which has found it hard to attract steady institutional interest since its start in 2022. Although IIBX volume grew from 411 kg in FY 2023 to 92 tonnes in FY 2025, activity has slipped in FY 2026, with most trades stemming from bullion imports instead of long‑term investment.

Sawrikar explained that the fund creates a new class of institutional participation at the exchange by treating gold as a financial asset rather than merely enabling imports. “IIBX was designed to be top‑tier infrastructure for gold trading and storage—regulated, transparent and LBMA‑compliant. Yet its full value appears only with steady use. Our fund will be the first institutional vehicle to employ IIBX and the IIDI vaults for holding gold as a long‑term financial asset, not for import‑related activity,” he said.

He added that the model could draw interest from family offices, fund managers and other institutional players, strengthening Gift City participants, deepening Gift City’s role as a global bullion‑finance hub. Artha Bharat highlighted gold’s structural portfolio advantages: a near‑zero correlation with equities (0.02 versus the S&P 500), no counterparty risk, and a strong long‑term return track record. The fund pointed out that gold has posted a 10‑year CAGR of 13.7 %, a five‑year CAGR of 20.4 %, and roughly 20 % return over the last year (as of June 30 2026). It also noted that gold’s annual compounded gain since 2001 stands at 12.1 %, versus the S&P 500’s 10.4 % total return over the same span.

Published on July 3, 2026