Share Market: Samir Arora, founder and chief investment officer of Helios Capital, said at the Business Standard Manthan Summit 2025 that imposing capital gains tax on investors in India, particularly foreign investors. He called it the Central government’s “biggest mistake”.
He said that capital gains tax is souring sentiment for foreign investors, who have been on an unabated selling spree for 5 months. In the last 2 months alone, foreign institutional investors (FIIs) have pulled out over Rs 1 lakh crore from the Indian equity markets.
“The biggest mistake they (the government) have made, the biggest souring of sentiment, and reality which they have to accept is capital gains tax in India, particularly the foreign investors, is 100% wrong,” said Arora at the summit. “The largest investors in the world and in India are Foreign Sovereign Funds, Pension Funds, Universities, and the High Net worth Individuals (HNIs). Taxing them on their gains, especially when they have no tax set-off available in their home country and when they face forex-related risks, is a big mistake that the government is making,” he added.
“India should waive the capital gains tax to respect the markets and foreign investors,” Arora suggested.
Share Market Crash
The Indian share market has witnessed a massive fall since the beginning of 2025. There has been a trend of constant sell-offs by foreign investors, leading to a loss of over Rs 50 lakh crore in market capitalization in just 2 months of 2025.
In the meanwhile, Sensex has dropped over 5,300 points since January 1, where Nifty50 dropped over 1,600 points during this period. Also, Foreign Investors withdrew Rs 1,12,601 crore from the Indian equities during the given time period.
According to the data available at the Bombay Stock Exchange (BSE), the total market capitalization of listed companies stood at around Rs 445 lakh crore on January 1, 2025, but has dropped to approximately Rs 393 lakh crore as of the end of February.
