Pradeep Bhandari, national spokesperson for India’s ruling Bharatiya Janata Party (BJP), has called for a sovereign Bitcoin reserve pilot and regulatory clarity on crypto assets. Writing in India Today, Bhandari said India must act decisively to keep pace with the shifting global financial order, where nations like the United States and Bhutan are integrating Bitcoin into national reserves and infrastructure.
“This isn’t a reckless pivot,” Bhandari stated. “It’s a calculated step toward embracing digital assets’ legitimacy.”
Bhandari’s remarks reflect growing concern that India is lagging behind other global powers in its crypto strategy, despite having one of the largest and most tech-savvy populations in the world. His call comes as the US, China, Russia, and Brazil accelerate national-level crypto initiatives, a contrast to India’s current stance of taxing crypto assets heavily without a formal regulatory framework.
Crypto in India: Taxed but Unregulated
India’s approach to cryptocurrencies remains ambiguous. While the government has imposed significant taxes on digital assets, it has not yet implemented a comprehensive regulatory structure.
Currently, under Section 115BBH of India’s Income Tax Act, all profits from the sale of virtual digital assets (VDAs) like Bitcoin and Ether are taxed at a flat 30%. Taxpayers can deduct the cost of purchase but are not allowed to deduct any other expenses or capital losses, making it one of the harshest tax regimes for crypto in the world. Additionally, a 1% Tax Deducted at Source (TDS) is levied on all transactions above $115 (₹10,000), further discouraging trading activity and reducing liquidity in the Indian market.
Despite this, the government has taken modest steps on the international stage. During its G20 presidency in 2023, India helped form a crypto working group in collaboration with the International Monetary Fund (IMF). However, domestic progress remains stalled.
Global Momentum: US and Bhutan Lead the Way
Bhandari pointed to examples of international momentum as a reason for India to act. In the United States, several states including Texas, Oklahoma, and Utah have already approved the use of Bitcoin as a reserve asset. Moreover, the US federal government is reportedly exploring budget-neutral purchases to expand its Bitcoin reserves, further embedding the asset into its financial strategy.
Bhutan, on the other hand, has taken a different route, initiating state-backed Bitcoin mining operations powered by its abundant hydroelectric resources. These efforts showcase how nations are using their unique advantages, be it renewable energy or regulatory freedom to position themselves as leaders in the crypto economy.
“India, with its growing renewable energy infrastructure, can and should adopt a similar forward-thinking approach,” Bhandari suggested.
A Call for Regulatory Clarity and Innovation
Bhandari’s proposal extends beyond just holding Bitcoin as a reserve. He advocates for a structured and transparent regulatory framework that can enable innovation while protecting investors. He believes that launching a Bitcoin reserve pilot could be the first step in achieving both goals, encouraging development in the sector while ensuring state oversight.
“India stands at a pivotal juncture,” he wrote. “A measured Bitcoin strategy, perhaps a reserve pilot could strengthen economic resilience and project modernity.”
In his view, the lack of regulation is not just a risk for investors but also a missed opportunity for national innovation. Clear rules could support Web3 startups, attract international capital, and solidify India’s role in the next financial revolution.
Pradeep Bhandari’s proposal serves as a timely reminder that while India taxes crypto heavily, it lacks a strategic plan to harness its potential. With global powers moving swiftly, the window for India to assert leadership in the digital asset space is narrowing.
