Government of India issues notification regarding sovereign wealth funds and global pension funds

Jul 9, 2020

In order to boost foreign investment in India’s infrastructure sector, the government has issued a notification that, effective from April 1, 2021, sovereign wealth funds and global pension funds will be fully exempt from tax in respect of their incomes arising from interest and dividend, and capital gains arising from their investments in India.

Reports indicate that investments made by such funds either, directly or through vehicles such as Category-I or Category-II Alternative Investment Funds, into as many as thirty-four (34) defined infrastructure sectors will qualify for the tax exemption.

Sovereign wealth and pension funds have deep pockets and are patient long-term investors. Giving them such a huge tax benefit will surely incentivize them to make big-ticket investments in infrastructure, including warehousing, logistics, cold chains, energy, hospitals, telecom, educational institutions, etc.

More News

Primer on doing business in India

India is one of the fastest-growing economies in the world and the business and regulatory environment is rapidly evolving and improving. Various policy changes and initiatives have transformed India from a closed economy to a liberal one. The days of the 'licence...

read more