India considers a strategic bitcoin reserve: pilot project p…

Pradeep Bhandari of India’s ruling party calls for regulatory clarity on digital assets and proposes a strategic bitcoin reserve.

Pradeep Bhandari, official spokesperson for the Bharatiya Janata Party (BJP) — India’s ruling party — has proposed the implementation of a pilot project for a national bitcoin reserve.

In an article published by India Today, Bhandari highlighted how the growing global acceptance of cryptocurrencies represents a strategic opportunity that India should not miss. The politician pointed out that the U.S. initiative for a bitcoin reserve and the state-led mining operations in Bhutan demonstrate how global finance is evolving toward digital assets.

India’s current approach to cryptocurrencies presents a unique peculiarity on the global stage. As Bhandari noted, the country finds itself in a situation where cryptocurrencies are taxed but lack a clear regulatory framework.

The Indian government has implemented a 30% tax rate on profits derived from the sale of virtual digital assets (VDAs). This taxation, governed by Section 115BBH of the Income Tax Act, does not allow for deductions of additional expenses or losses, except for acquisition costs.

Additionally, a 1% tax deducted at source (TDS) has been introduced on all cryptocurrency transactions exceeding $115, applied to both buyers and sellers.

During India’s G20 presidency in 2023, the country helped coordinate a working group on cryptocurrencies alongside the International Monetary Fund. However, Bhandari observed that while India awaits the development of international recommendations, other nations are rapidly advancing their own digital asset programs.

The BJP spokesperson cited the example of the United States, which has planned to expand its bitcoin reserves through balance sheet-neutral purchases. Three U.S. states (New Hampshire, Arizona, and Texas) have already passed bills on state bitcoin reserves.

According to Bhandari, India has structural advantages that could support the implementation of a sovereign bitcoin strategy. The country is expanding its renewable energy infrastructure — a key component for sustainable mining operations.

The proposal for a pilot project on a strategic bitcoin reserve, in the politician’s words, would not be “a reckless pivot, but a calculated step toward embracing digital assets’ legitimacy.”

For Bhandari, a well-planned bitcoin strategy could strengthen the country’s economic resilience and project an image of modernity within the global financial landscape.

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