As a result of the COVID-19 epidemic, India’s digital adoption rate increased.
Reserve Bank of India (RBI) is working on introducing India’s own digital currency.
Historically, India has had a rocky relationship with digital assets, particularly cryptocurrencies. However, the Supreme Court overturned a prohibition on cryptocurrency transactions in March 2020, which was enacted in 2018. Since then, there have been calls for stricter regulations. Last week, the country implemented a 30 percent flat tax on cryptocurrency and digital asset investments, ignoring objections from investors. One or two ministers advocate for a rise in this figure, arguing that for crypto traders/investors, the 30% tax rate doesn’t matter.
Already Shaken Industry
Union Finance Minister Nirmala Sitharaman, on Monday, April 18, at IMF meet, cast fresh concerns on the already shaky cryptocurrency industry in India, saying the greatest danger surrounding cryptocurrency is its ability to be used for money laundering and terror funding.
Sitharaman said:
“The biggest risk for all countries across the board will be the aspect of money laundering and that of such currency being used for financing terror.”
As a result of the COVID-19 epidemic, India’s digital adoption rate increased, according to Sitharaman, who also emphasized government efforts to develop a digital infrastructure foundation during the last decade.
At the India Today conference in March, Nirmala Sitharaman remarked that India is not closing out all alternatives when it comes to cryptocurrencies or blockchain and fintech. As Sitharaman had said, a Cabinet note is now being produced that would offer all the information needed to formulate Indian cryptocurrency rules. She had also remarked that the Reserve Bank of India (RBI) is working on introducing India’s own digital currency, as was announced in the Budget 2022.