Daijiworld Media Network - New Delhi

New Delhi, Jun 15: Finance Minister Nirmala Sitharaman on Monday indicated that the Centre is preparing additional measures to attract foreign capital into the Indian market, saying recent policy initiatives are only the beginning of a broader strategy to boost overseas investments.

Speaking at the Hero Mindmine Summit 2026, Sitharaman said the government's decision to exempt withholding tax on interest income and capital gains tax earned by foreign investors in government securities (G-secs) was aimed at making Indian markets more attractive to global investors.

“Certainly, that's not the end of the story, there will be more. We recognise we need more foreign capital to come in,” the Finance Minister said.

She highlighted recent steps taken jointly by the government and the Reserve Bank of India (RBI) to facilitate foreign capital inflows and improve market liquidity.

On June 5, the RBI permitted banks to access its swap facility for Foreign Currency Non-Resident (Bank) [FCNR(B)] deposits with maturities ranging from three to five years until September 30. The facility enables banks to swap US dollar deposits with the RBI and manage currency-related risks more effectively.

The government has also introduced a concessional foreign exchange swap facility aimed at encouraging public sector undertakings (PSUs) to raise External Commercial Borrowings (ECBs) until September 30.

Explaining the benefits of the RBI framework, Sitharaman said the central bank would bear the cost of currency hedging, allowing banks greater flexibility in raising overseas funds.

“And as a result, the banks can now go unfettered to raise their own fund. So we have taken a very calibrated approach to make sure that the markets do see the required investments,” she said.

The Finance Minister also expressed concern over rising import dependence and global economic uncertainties, noting that the Indian economy is facing considerable pressure due to imports of critical raw materials, crude oil and fertilisers.

She said the global economic environment is changing rapidly, with fresh challenges emerging almost every week, making it necessary for India to remain prepared for unforeseen circumstances.

“The global situation is changing almost every week with newer challenges emerging and the country has to be ready for every such exigency,” Sitharaman said.

Her remarks come amid efforts by policymakers to maintain economic stability, strengthen foreign exchange reserves and attract long-term foreign investments despite volatile global conditions and geopolitical uncertainties.