You are here: Home » Economy & Policy » News
Business Standard

Govt waives three-year lock-in period on investments made by NRIs in IDFs

With an aim to accelerate and enhance flow of long-term debt in infrastructure projects, amendments in the tax laws were made to provide exemption from income tax to infrastructure debt funds in 2011

Press Trust of India 

steel, infrastructure
Representative Image

The government has waived the three-year lock-in period on investments made by non-residents in infrastructure debt funds (IDFs), to promote funding in the A notification had been issued by the (CBDT).

With an aim to accelerate and enhance flow of long-term debt in infrastructure projects, amendments in the tax laws were made to provide exemption from income tax to infrastructure debt funds (IDFs) in 2011.

To attract off-shore investments into IDFs, any amount of interest received by non-resident or foreign company from investment in such IDFs is charged at a reduced tax rate of 5 per cent, said Taxmann Deputy General Manager Naveen Wadhwa.

IDFs are investment vehicles to accelerate the flow of long-term debt to the sector.

Wadhwa said if a non-resident transfers rupee-denominated bonds of IDF to another non-resident outside India, such transfer is not regarded as transfer for the purpose of capital gain, and no capital gain tax is charged on such transfer.

First Published: Wed, September 18 2019. 02:29 IST
RECOMMENDED FOR YOU