India’s Economic Fundamentals Remain Strong - Nirmala Sitharaman

Union Finance Minister Nirmala Sitharaman has reiterated that India’s macroeconomic fundamentals remain strong, attributing the rupee’s sharp fluctuations in the foreign exchange market primarily to global uncertainty. She said the Reserve Bank of India (RBI) is taking all necessary measures to stabilise the rupee against the US dollar and other major currencies. These efforts have contributed to the rupee gaining more than 1% against the dollar over the past two days, she noted. Sitharaman made the remarks at the Bloomberg New Economy Forum 2027, adding that the government has no plans to set a fixed exchange rate for the rupee against the dollar.

Capital Gains Tax Under Review

Sitharaman welcomed discussions on rationalising short-term and long-term capital gains taxes, saying she has received requests from both domestic and foreign investors on the issue. However, she declined to comment further because the Union Budget is scheduled for February. Separately, an SBI Research report released on Tuesday said that abolishing the long-term capital gains tax (LTCGT) may be necessary to attract foreign portfolio investment (FPI) into India.