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India's chief economist says that equities are less tax-efficient than bonds.

India's Chief Economic Adviser V. Anantha Nageswaran stated on Friday that the case for changes to capital gains tax on equities was weaker than bonds. This suggests that the government does not see a need to make further adjustments to its tax regime.

India exempted institutional foreign investors from capital gains taxes on government securities last week. The move was made to attract more "capital" at a moment when foreign equity outflows are surging, oil prices are high, and the currency is under pressure.

South Asia is the third largest oil consumer and importer in the world. It ships about 90% of its crude oil. It's also one of the most vulnerable countries to war-related disruptions of global energy supplies.

The sustained increase in oil prices could hinder the economy, inflation and government finances. This is especially true when El Nino, a weather phenomenon which often predicts droughts, is looming.

Nageswaran, a broadcaster for NDTV, said that the Reserve Bank of India’s 6.6% economic growth forecast for fiscal 2027 is realistic. However there are downside risks of 20-30 basis point.

Nageswaran's estimates for fiscal 2027 were made in?February before the Middle East conflict.

Nageswaran said that the nation's fuel retail stores may not need to pass on much more in terms of higher oil costs to consumers, if global prices are as expected by financial markets to fall for a full year.

In May, state-owned fuel retailers increased prices four times.

(source: Reuters)