Archive · 13 Jan 2026
India Considers Tax Incentives for Foreign Investors
The Indian government is thinking about giving special tax breaks to foreign investors to encourage them to invest more in India.
This is because foreign investors have been selling a lot of shares, which has put pressure on the stock market.
Samir Arora, a well-known investor, suggests that instead of giving special breaks to foreign investors, the government should remove the Long-Term Capital Gains (LTCG) tax for everyone.
This could make investors happier and help the market recover.
The government is also considering other measures to support the real estate sector and improve affordability for homebuyers.
However, the rupee has been falling, and there are other factors affecting foreign investment, so tax breaks alone might not solve all the problems.
The Indian government is considering tax incentives for foreign pension and endowment funds to boost investment.
Samir Arora proposes removing the Long-Term Capital Gains (LTCG) tax for all investors to improve market confidence.
Foreign Institutional Investors (FIIs) have sold over $18 billion in shares in 2025 due to geopolitical and external risks.
The rupee has depreciated by over 4% in 2025, breaching the 90 mark against the US dollar.
The real estate sector is advocating for policies to improve affordability and demand in the housing market.
- Who
- Indian government, Samir Arora, Foreign Institutional Investors (FIIs)
- What
- Proposed tax incentives for foreign investors and potential removal of Long-Term Capital Gains (LTCG) tax
- When
- Discussions ongoing, potential announcement in Union Budget 2026-27
- Where
- India
- Why
- To boost foreign investment, improve market confidence, and address rupee depreciation
- Proposed Tax Incentives
- Foreign pension and endowment funds
- Current Market Issue
- Heavy selling by FIIs
- Samir Arora's Proposal
- Zero LTCG tax for all investors
- Potential Impact of LTCG Removal
- Improved market confidence, reduced FII selling, boosted long-term investment, supported forex reserves, and increased investor enthusiasm
- FII Decision-Making Timeframe
- Months to a year
- FPI Sales in 2025
- Over $18 billion
- Rupee Depreciation in 2025
- Over 4%
Sources
Just Scrap LTCG & Ignore All Other Ideas, Samir Arora Says, The One Bold Step That May Pull FIIs Back To India
Budget 2026: Tax booster for foreign portfolio investors being discussed
Budget 2026: Sustained investment in urban infra, incentives for affordable housing among key demands of real estate sector
'Tax incentives to FPIs won't help, make LTCG zero for all': Samir Arora - BusinessToday
What Yogesh Patil says on defence, chemicals, BFSI, other sectors
LTCG, STCG, STT, tax on dividend income: What stock investors should watch in Budget 2026