By
Chimamanda U. Martha
November 27th, 2023
On the occasion of the G20 summit, India said that it is willing to closely cooperate with all member nations to work on a clear regulatory framework for crypto.
In the upcoming months, India is planning to decide its own position and stand on digital assets after proper analysis and consultations. India would obviously consider the stance of global leaders on the acceptable crypto regulatory framework.
While speaking on the sidelines of the G20 summit over the past weekend, Ajay Seth, Secretary of the Department of Economic Affairs, said:
“India’s position will be decided in the coming months. The framework for assessing risk has been put together by the G20” we will analyse “what globally the leaders have agreed to” and then decide on “what will be a sound policy for India.”
The G20 member nations have endorsed the recommendations of the International Monetary Fund (IMF) and the Financial Stability Board (FSB) for the crypto regulatory framework.
India’s stance on cryptocurrencies has been a subject of scrutiny for several years. The nation initially saw a thriving crypto industry, but it subsequently faced numerous challenges, including onerous taxes, a crypto winter, what some termed a “shadow ban”, anti-money laundering regulations, and enforcement actions against prominent crypto exchanges.
Seth’s statements on Sunday signal a potential change in direction, suggesting that India might be considering the development of its cryptocurrency legislation. This marks a significant development since India had previously halted its plans for comprehensive crypto legislation through a bill in early 2022.
India Not Banning Crypto in the Future?
In the past, India’s central bank – the Reserve Bank of India – proposed an outright ban on cryptocurrencies. However, it seems that India might not proceed with such a hard stand on digital assets. “If any country wants to ban it you can ban it, but if the rest of the countries are not banning it will be extremely difficult to implement the ban,” said a senior government official.
Although the G20’s consensus on crypto regulation holds significance, its effectiveness may be limited unless all countries take coordinated action, according to the official. India’s policy deliberations will now unfold on two fronts.
At the multilateral level, India will advocate for consensus on crypto regulations within the G20. Notably, India played a role in including the crypto issue in the G20’s agenda. Simultaneously, the Indian government is striving to foster agreement on crypto regulations among countries that are not part of the G20. The official emphasized the need for these efforts to extend beyond the G20 group of nations.