The Indian cryptocurrency industry is seizing a rare window of opportunity to lobby for tax reforms, as the government of Prime Minister Narendra Modi shows signs of warming toward digital assets, according to a Financial Times report published Tuesday.
Trump’s Crypto Momentum Reaches India
Executives at leading Indian crypto exchanges say the recent pro-crypto sentiment in global politics — especially following Donald Trump’s return to the White House — has helped shift attitudes in New Delhi.
“Thanks to Trump, the positive momentum that has happened in crypto has impacted India as well,” said CoinSwitch co-founder Ashish Singhal.
Since Trump’s re-election, the Modi government has become more receptive to discussions around cryptocurrencies, signaling the potential for a policy shift in the world’s most populous democracy.
Industry’s Top Priority: Tax Relief
The Indian crypto industry’s “big ask” is a reduction in harsh crypto taxes, Singhal told FT. Currently, Indian users face a 30% capital gains tax on crypto profits and a 1% tax deducted at source (TDS) on every transaction — a structure many argue stifles innovation and investment.
“The taxes are very harshly imposed and discourage both retail and institutional participation,” Singhal emphasized.
Crypto stakeholders believe that tax reform would not only revive trading volumes but also strengthen compliance and transparency in the ecosystem.
RBI Tone Shifts from Hostile to Neutral
India’s central bank, the Reserve Bank of India (RBI), has historically taken a strong stance against crypto, banning banks from servicing digital asset companies in 2018. However, the Supreme Court overturned that ruling in 2020, marking a significant turning point.
Now, under RBI Governor Sanjay Malhotra, the central bank’s attitude has gone from “negative to neutral,” according to Singhal. While RBI remains cautious, it has avoided direct criticism of crypto in recent months — signaling an improved regulatory environment.
A New Era for Crypto Policy in India?
As India’s crypto entrepreneurs continue to engage policymakers, there’s growing optimism that 2025 could be the year of meaningful reforms. Industry leaders argue that clear regulations and lower taxes are critical to making India a global hub for blockchain innovation.
The coming months will be key in determining whether India’s crypto future is driven by opportunity — or further constrained by outdated tax policies.