India Plans RBI-Backed Digital Currency
Indian Union Minister Piyush Goyal announced that India is preparing to launch a digital currency. This currency will be backed by the Reserve Bank of India (RBI). The goal is to make financial transactions faster, more transparent, and less reliant on paper money.
Speaking at an event, Goyal clarified that the government does not support cryptocurrencies without official backing. He referred to private digital tokens not linked to the RBI or any national currency.
“We are not encouraging cryptocurrencies that have no sovereign or asset backing,” Goyal said. He added that the digital rupee will function like traditional money but with benefits such as traceability and efficiency.
India’s Approach to Private Cryptocurrencies
Goyal noted that private cryptocurrencies are not banned but face heavy taxation. This discourages speculation and protects consumers.
“There is no ban, but it is taxed very heavily,” he said. “We don’t encourage it because we don’t want anybody to be stuck with a cryptocurrency that has no backing.”
The RBI-backed digital rupee aims to provide a safer and more reliable digital payment option.
Currently, crypto gains in India are taxed at 30%, with minimal deductions allowed. Additionally, a 1% tax deduction at source (TDS) applies on transfers above a certain limit. This shows the government’s cautious stance on digital assets without sovereign support.
Trade Relations and Future Plans
During his visit to Doha, Goyal also discussed enhancing India’s trade ties. He mentioned that a Free Trade Agreement (FTA) with Qatar could be finalized by mid to late next year.
