Indian Finance Minister Nirmala Sitharaman said that she expects the central bank to roll out its digital currency this year.
About the legalization of bitcoin and other digital currencies, she noted that the government is not inclined to take a position just yet. It has set in motion a consultation process, and when it ends, the government will look at the insights generated before taking a position, she clarified.
India’s CBDC Plans on Track
Speaking at the annual summit of India Global Forum, Sitharaman replied to a question about CBDC, saying RBI is designing it and she expects this to come out this year.
“It was a conscious call taken in consultation with the central bank – the Reserve Bank of India. We would like them to design it the way they would like to do it, but this year we expect the currency to come out from the central bank itself,” she said.
The Indian Finance Minister appeared upbeat about the prospects of a central bank-sponsored digital currency making payments and banking transactions easier and more efficient.
“We see clear advantages in a central bank driven digital currency, because in this day and age, bulk payments happening between countries, large transactions between institutions and large transactions between central banks themselves of each country are all better enabled with digital currency,” she said.
Govt Sees Revenue in Crypto
Sitharaman responded to the widespread skepticism about the government’s move to tax crypto transactions without making them legal. She said many Indians had seen a bright future in digital assets; therefore, the authorities outlined a possibility for revenue in the industry, she said with a touch of witticism.
She clarified that the government doesn’t want to legalize, ban, or regulate cryptocurrencies at this stage. She said the consultations are going on, and the authorities don’t want to ignore any legal requirement. The government will come out with its stance on crypto after the consultations are over and it has given adequate thought to the outcome.
Taxes and Ad Regulations for the Indian Crypto Sector
Instead of the much-anticipated crypto bill, the Indian government brought a tax regime in February for the crypto sector through the annual budget proposals for 2022-23. It levied 30% tax on digital asset profits and 1% tax on such transactions.
The authorities also said the central bank will launch its CBDC in the coming fiscal (2022-23). Later, the Indian finance minister noted that the government and the central bank – the Reserve Bank of India (RBI) – are on the same page on CBDC and crypto legalization issues.
Soon, the self-regulatory body of the Indian advertising industry, the Advertising Standards Council of India (ASCI), came out with a guideline for crypto sector advertisements. It said that all ads of such exchanges, businesses, and NFTs should carry a disclaimer stating: “Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions.”