ASSOCHAM called for further tax rationalisation and simpler tax rules to attract stable, long-term foreign investment, welcoming recent RBI and Finance Ministry steps to bolster investor confidence amid rupee volatility and FPI flow swings. It welcomed the Income-tax Amendment Ordinance, 2026, which exempts FPI investments in government securities from tax on interest and capital gains from April 1, 2026, and Finance Minister Nirmala Sitharaman's remarks that the government wants investor views on long-term capital gains tax and securities transaction tax ahead of the 2027-28 Union Budget. The group cited RBI measures that helped the rupee recover nearly 2% from recent lows, and suggested considering SBI Research's proposal to extend long-term equity holdings to two to three years with incentives. It said global factors such as high US bond yields, elevated crude prices and capital shifting toward AI had driven FPI volatility.
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- ASSOCHAM calls for tax simplification , long - term holding incentives to strengthen capital flows
ASSOCHAM has urged further tax rationalisation and simpler, standardised tax rules to attract stable, long-term foreign investment into India. It welcomed recent RBI and government measures to stabilise the rupee and the Income-tax Amendment Ordinance, 2026, which exempts FPI investment in government securities from tax on interest and capital gains from April 1, 2026. The body also backed the government's consultation on long-term capital gains tax and securities transaction tax ahead of the Union Budget 2027-28, and proposed extending the definition of long-term equity holdings to two-three years with incentives. ASSOCHAM cited the rupee's recovery of nearly 2 per cent from recent lows and a 7.1 per cent GDP growth projection for FY27, while noting that high US bond yields, elevated crude prices and a shift towards AI-related investments had driven volatility in FPI flows.
- ASSOCHAM calls for tax simplification , long - term holding incentives to strengthen capital flows
Industry body ASSOCHAM called for further tax rationalisation and simpler tax rules to attract stable, long-term foreign investment, welcoming recent RBI and Finance Ministry measures to bolster investor confidence amid rupee volatility and FPI flows. It welcomed the Income-tax Amendment Ordinance, 2026, which exempts FPI investments in government securities from tax on interest and capital gains from April 1, 2026. ASSOCHAM also backed considering SBI Research's proposal to extend long-term equity holding definitions to two-three years with incentives, and welcomed Finance Minister Nirmala Sitharaman's remarks that the government wants investor views on LTCG and STT ahead of the Union Budget 2027-28. The group said RBI measures helped the rupee recover nearly 2 per cent from recent lows, and pointed to foreign exchange reserves and the RBI's 7.1 per cent GDP growth projection for FY27 as signs of economic strength.
- ASSOCHAM calls for tax simplification , long - term holding incentives to strengthen capital flows
ASSOCHAM urged further tax rationalisation and simpler tax rules to attract stable long-term foreign investment, and welcomed RBI and Finance Ministry measures to support the rupee and investor confidence amid FPI volatility. It welcomed the Income-tax Amendment Ordinance, 2026, which exempts FPI investments in government securities from tax on interest and capital gains from April 1, 2026. The body also suggested extending the definition of long-term equity holdings to two to three years with incentives, and welcomed the government's willingness to hear investor views on LTCG and STT ahead of the Union Budget 2027-28. It said high US bond yields, elevated crude prices and a shift of capital toward AI had contributed to FPI volatility.
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The industry body ASSOCHAM on Monday backed recent measures by the Reserve Bank of India (RBI) and the Finance Ministry to support the rupee and attract durable foreign capital. Its President, Nirmal K. Minda, aligned with former RBI Governor D. Subbarao's view that the rupee's long-term strength depends on sustained capital flows backed by strong fundamentals. The chamber said these steps helped the rupee recover from recent lows and cited the successful close of the $133 billion FCNR(B) mobilisation window on August 31. Chief Economist S.P. Sharma pointed to healthy forex reserves and the RBI's projected 7.1 per cent GDP growth for FY27. ASSOCHAM also welcomed the tax exemption for FPI investments in government securities from April 1, 2026, and the consideration of investor feedback on LTCG and STT for the 2027-28 Budget, while calling for tax rationalisation and incentives for longer-term equity investment.
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