Home Affairs Minister Hlengiwe Mkhize said the Guptas were granted citizenship based on business investments and social partnerships with 75 North West schools, among other things.
Mkhize was replying to EFF MP Hlengiwe Hlophe's parliamentary question. Hlophe had asked what the "exceptional business circumstances" were that led to the family being granted citizenship.
The decision was based on a motivation letter written by the family through their company, Oakbay Investments.
"The consideration to grant citizenship to the family was based on the business investments and social partnerships as highlighted in the Oakbay company letter," Mkhize replied to Hlophe.
She said the letter also included a detailed company profile and the family's business commitments to "social partnerships with 75 schools in the province of the North West amounting to R1m".
"It further outlined its (the family's) loyalty and commitment to job creation in the form of 7 000 permanent employees throughout the variety of family companies."
The decision was taken while Finance Minister Malusi Gigaba was minister of home affairs in 2015. He moved to his new portfolio during President Jacob Zuma's Cabinet reshuffle in March.
'Guptas must be treated with dignity'
Mkhize told the National Assembly two weeks ago during an oral question session that the Gupta family should be treated with respect.
"We have to treat people with dignity. We treat matters of this nature within the parameters of the law. We should be guided by the outcomes of that process."
She also told MPs she would not revoke the family's citizenship should their businesses be sold and they relocate to Dubai.
Mkhize had also said she may have come to the same conclusion as Gigaba had she been in the portfolio at the time.
"If I was in that position in that time, the priority would be to look at their contribution to the growth of our economy. I would make sure to create a conducive environment for them to invest in the country."
In June, Gigaba dodged accountability on the Guptas' naturalisation when he failed to appear before the portfolio committee on home affairs to discuss the matter.
Gigaba informed the committee that he couldn't make it due to "prior commitments". He was already minister of finance at the time.