India exempts foreign investors from G-Sec taxes under 2026 ordinance
Business
India just announced that foreign investors won't have to pay any taxes on returns from government bonds (G-Secs) anymore.
The new rule, kicked off by the Income Tax Amendment Ordinance of 2026, scraps both the 12.5% capital gains tax and the 20% withholding tax on interest, and it applies retroactively from April 1, 2026.
Exemption covers BIS to attract investors
The same tax break now also covers the Bank for International Settlements (BIS), a big player in global finance.
Officials hope this will make Indian bonds more attractive worldwide and draw in more international investment.
Analysts think it's a smart step for connecting India's bond market with global financial systems and building up the country's presence in international debt markets.