The Indian government plans to regulate crypto only after taking inputs from stakeholders outside the country. Currently, India is seeking consultation from the International Monetary Fund (IMF), World Bank, SEBI, RBI, and other bodies. The Indian Finance Minister said that they would be incorporating the inputs into the country’s crypto policy. It could be a matter of concern because the IMF and World Bank don’t seem to be a fan of crypto.
The Indian government is taking foreign inputs for crypto regulation
Right now, the regulatory framework for cryptocurrencies in India is non-existent. The only thing we have in the name of the law is a mammoth 30% tax and 1% TDS with no loss set off. So, India is treating cryptocurrencies like gambling which a framework might change. The officials of the country have drafted a consultation paper to reach out to stakeholders in and outside the nation and get suggestions. In the country, the essential bodies are RBI and SEBI, while outside its the IMF and World Bank.
The Indian authorities are going to finalize the consultation paper in the next 6 months. It will cover all the necessary aspects related to regulation like risk management, treatment as an asset class, and how to deal with crypto in general. These are all basic things that will form the base of the crypto policy of India. The authorities will then work on them and make the laws amenable to the Indian government.
India doesn’t know how to treat crypto right now, and therefore they have chosen the gambling path. I am optimistic that as the authorities form a proper regulatory framework that addresses all their concerns, a tax reduction will also be seen. Until then, the government’s decision to levy such a high tax, even though it is unfair, is in a way telling the consumers to stay away from crypto. However, it doesn’t take into account the millions of people who have already invested and are heavily dependent on the industry.
As India is reaching out to foreign stakeholders and seeking consultation from the International Monetary Fund (IMF), it is difficult to say will India have a positive or negative policy. What are your thoughts on the same? Let us know in the comments below. Also, if you found our content informative, do like and share it with your friends.