Indian Government Reassesses Crypto Regulations Amid Global Shifts
The Indian government is currently reconsidering its approach to cryptocurrency as the international perspective on digital assets begins to evolve, according to a report from Reuters on Monday. Although cryptocurrencies remain largely unregulated in India, the government initiated a taxation framework for digital assets in 2022. This framework includes a 1% tax-deducted-at-source (TDS) on crypto transactions and a hefty 30% capital gains tax.
Since the introduction of these taxes, the cryptocurrency sector in India has been actively advocating for the Narendra Modi-led government to relax taxation policies and provide clearer regulatory guidelines to foster the growth of digital assets within the country. However, these appeals have so far been met with resistance.
As the Indian government’s review unfolds, it coincides with a shift in the U.S. landscape, where former President Donald Trump’s crypto-friendly administration has rekindled optimism for broader cryptocurrency adoption and the approval of various financial products linked to digital tokens. This global momentum is influencing Indian policymakers.
“More than one or two jurisdictions have altered their perspectives on cryptocurrency regarding its usage and acceptance, recognizing the significance of crypto assets,” stated India’s Economic Affairs Secretary Ajay Seth in an interview with Reuters. “In light of these developments, we are revisiting the discussion paper on cryptocurrencies.”
This discussion paper, which outlines potential regulatory frameworks for cryptocurrencies, had been shelved last year as officials prioritized other pressing matters, as noted by CoinDesk. As the landscape continues to shift, all eyes are on how India will adapt its policies in response to both domestic and international pressures.
