Regulating Crypto Assets Is High on the Agenda for India: IMF Official

Regulating Crypto Assets Is High on the Agenda for India: IMF Official

 

A director at the International Monetary Fund (IMF) says that crypto regulation is "certainly high on the agenda" for India. "We are trying to come up with global standards for crypto asset regulations. I think that’s important for India to also adopt, "said the IMF official.

Tobias Adrian, Financial Counselor and Director of the International Monetary Fund (IMF)’s Monetary and Capital Markets Department, discussed India’s crypto regulation. He explained in an interview with PTI, at the annual spring meeting of the IMF and the World Bank. Adrian said that for India, regulating crypto assets is certainly high on the agenda.

"That is something that is done globally," he stressed. Within the Financial Stability Board, we are trying to come up with global standards for crypto asset regulations. I think that’s important for India to also adopt. 

Officials from India’s Ministry of Finance have reportedly been consulting with the IMF and the World Bank on crypto policies as the government works on how to treat crypto assets.

The IMF director then commented on the taxation of crypto transactions in India. "Of course, I know that India has changed the taxation of crypto assets and that’s a welcome move."

The Indian government started taxing cryptocurrency income at 30% without allowing loss offsets or deductions on April 1. Crypto trading volumes subsequently plunged across exchanges in the country. A further 1% tax deduction at source (TDS) will soon go into effect.

Overall, the IMF is looking at India in "a very positive fashion." He was quoted as saying, "I think there are many opportunities and growth (in India) is coming back." There’s a recovery. There’s a lot of excitement around new growth opportunities, new developments,... We always value that growth is inclusive and touches all of the people. But our general outlook in India is a fairly positive one. "

The IMF official also discussed the central bank's digital currency (CBDC). In India, the central bank, the Reserve Bank of India (RBI), is actively working on a digital rupee. The Finance Minister Nirmala Sitharaman had said, that it will be introduced in the current financial year.

Indian Prime Minister Narendra Modi previously explained: "The digital rupee will be the digital form of our physical rupee and will be regulated by the RBI." "The digital rupee will revolutionise the fintech sector," Modi noted.

Earlier this month, RBI Deputy Governor T. Rabi Sankar said the central bank would go about launching a digital currency "in a much calibrated, graduated manner, assessing impact all along the line."

Commenting on India's exploration of a central bank digital currency, the IMF director stated:

"That could be quite important for financial inclusion and financial development, and we are watching very closely what India is doing." We welcome those policy developments as well.