PodcastMay 29, 20267 min readyoutu.be

Will India Scrap Capital Gains Tax to Bring Back FIIs? | 29 May 2026 | Govindraj Ethiraj | The Core Report

00:00:02 | Global Markets, West Asia Conflict & Economic Indicators

Geopolitical Landscape: The war in West Asia between the US/Israel and Iran has run for a full 3 months with no definitive end in sight, forcing markets to brace for an impending fall. The truce is fracturing at several places, and considerable effort will be required to bring negotiations back to a reasonable starting point. Host Govindraj Ethiraj notes there is no point celebrating or mildly cheering any development in Iran-US talks until there are tangible outcomes.

References

Original source (youtu.be)

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Jun 2, 2026

Investing in a Divergent Economy | 1 Jun 2026 | Notes on the Week Ahead | David Kelly | J.P.Morgan

In his report "Investing in a Divergent Economy," Chief Global Strategist David Kelly outlines how the U.S. economy is currently defined by significant, growing disparities that mask a stable "average" economic path. Dimensions of Economic…

Jun 2, 2026

Falling Yields Reinforce Equity Market Resilience | June 1, 2026 | Professor Siegel Weekly Commentary | WisdomTree

Professor Siegel maintains a constructive and optimistic outlook on the equity markets, highlighting their ongoing resilience. This positive backdrop is driven by a combination of easing Treasury yields, a recent dip in oil and gasoline pr…

Jun 2, 2026

RBI Needn’t Hike Rates; Must Nudge Capital Flows By Bearing Hedging Cos Of ECBs: Chetan Ahya | 2 Jun 2026 | CNBC-TV18

Host: Latha Venkatesh Guest: Chetan Ahya Chief Asia Economist, Morgan Stanley Event Date: June 2, 2026 Ahead of RBI Monetary Policy Announcement on June 5, 2026 1. The monetary policy & exchange rate debate Rate hike rejection: 00:01:07 ht…

Speaker Profile: Ajay Roti, Founder and CEO of Tax Compass, Bangalore.
The Policy Question: As markets fall and the rupee depreciates sharply, there is an escalating clamor for the Indian government to cut or eliminate capital gains taxes on share sales by foreign portfolio investors.
Domestic Capital Resilience: Roti points out that India previously instituted a zero-tax regime because it was hungry for external capital. Today, domestic capital via Systematic Investment Plans (SIPs) and Domestic Institutional Investors (DIIs) is robust and capable of sustaining the market, reducing absolute reliance on foreign capital.
Global Alternatives: While peer jurisdictions like the United States and Singapore choose not to tax foreign portfolio investors, tax policy is highly dependent on a nation's specific development stage; there is no absolute right or wrong rate.
The Core Pain Point (Litigation over Headline Rates): Roti emphasizes that modifying headline tax rates (whether 10%, 12.5%, 20%, or 0%) will not solve the underlying issue. The primary deterrent for foreign capital is India's aggressive tax administration, tax scrutiny mechanisms, and persistent litigation.
- Private equity and venture capital funds face immense complications during exits because portfolio companies become trapped in multi-year tax disputes. This forces investors into inefficient escrows, lock-ins, and complex indemnity structures.
Policy Transitions & Retrospective Risks: Roti cites the Tiger Global court ruling as a disruptive event that altered historical treaty benefits for investors coming through specific routes. He notes that while the government has avoided massive retrospective legislative amendments, tax authorities routinely challenge established rules in court:
- India grandfathers old tax positions in the text of the law, but tax administrators actively question and litigate those grandfathered clauses in the court system.
- To manage policy shifts smoothly, the government must guarantee prospective changes in letter and spirit, provide clear guidance, and refrain from unravelling historical tax structures (such as the renegotiated Mauritius and Singapore treaties).

Speaker Profile: Moses Kimaru, Nairobi-based Digital Entrepreneur, Founder and CEO of Dot Savvy.
The Indian Context: The state government of Meghalaya signed a formal agreement with Elon Musk’s Starlink India to deploy satellite broadband across remote, topographically challenging hilly terrain. However, the commercial rollout remains stalled. The Telecom Regulatory Authority of India (TRAI) has yet to finalize satellite spectrum pricing, and the Department of Telecommunications (DoT) has not completed spectrum allocation. Domestic incumbents Airtel and Reliance Jio are also preparing competing satellite networks.
The Kenyan Precedent: While public hype three years ago suggested Starlink would completely disrupt Kenya's internet market, Kimaru highlights that the disruption never materialized as expected.
Market Share Limitations: Regulatory data reveals that Starlink has captured a mere 0.9% of Kenya’s total fixed internet subscriptions—amounting to between 25,000 and 30,000 active users. In contrast, terrestrial incumbent Safaricom commands over 35 million subscribers.
Aggressive Incumbent Counter-Strategy: The threat of Starlink caused local telecom incumbents to overreact and aggressively upgrade their own infrastructure. Providers lowered prices, increased broadband speeds, and expanded fiber-to-the-home and 4G/5G coverage. Consequently, Kenya’s total fixed internet market expanded by an impressive 85% in just 2 years, turning Starlink's entrance into a win for consumer pricing.
Technical & Economic Barriers:
- Urban environments present significant "obstructions" (dense trees and high buildings) that disrupt Starlink's clear line-of-sight to satellites, compromising connection reliability.
- The initial hardware terminal setup and monthly subscriptions originally neared a prohibitive cost of $1,000. Low-income or mass-market consumers prefer inexpensive terrestrial data bundles or lower-tier providers like Mawingu, which offers adequate 10 Mbps packages for a fraction of the cost.
The Niche Use Case: Starlink has established itself as a premium peripheral player. It operates as an essential alternative for high-end corporate redundancy (backup internet), non-profits, rural schools, and remote safari tourism lodges located entirely outside the reach of fiber or cellular towers.
Direct-to-Cell Innovation: Airtel Africa and SpaceX recently conducted successful live tests of "Starlink Direct-to-Cell" technology in Kenya. This architecture allows completely unmodified, standard 4G smartphones to connect directly to satellites in coverage dead zones—successfully executing text messaging, voice calls, and Airtel Money financial transactions without any specialized dish or external hardware.
The Oxygen Analogy: Post-COVID-19, high-speed internet in Kenya has evolved into a basic utility equivalent to oxygen. During a massive national transport strike prompted by rising fuel prices, domestic business continued entirely uninterrupted because the structural maturity of the network allowed the population to instantly pivot to working from home.

Will India Scrap Capital Gains Tax to Bring Back FIIs? | 29 May 2026 | Govindraj Ethiraj | The Core Report

00:00:02 | Global Markets, West Asia Conflict & Economic Indicators

References

Investing in a Divergent Economy | 1 Jun 2026 | Notes on the Week Ahead | David Kelly | J.P.Morgan

Falling Yields Reinforce Equity Market Resilience | June 1, 2026 | Professor Siegel Weekly Commentary | WisdomTree

RBI Needn’t Hike Rates; Must Nudge Capital Flows By Bearing Hedging Cos Of ECBs: Chetan Ahya | 2 Jun 2026 | CNBC-TV18

Will India Scrap Capital Gains Tax to Bring Back FIIs? | 29 May 2026 | Govindraj Ethiraj | The Core Report

00:00:02 | Global Markets, West Asia Conflict & Economic Indicators

References

Investing in a Divergent Economy | 1 Jun 2026 | Notes on the Week Ahead | David Kelly | J.P.Morgan

Falling Yields Reinforce Equity Market Resilience | June 1, 2026 | Professor Siegel Weekly Commentary | WisdomTree

RBI Needn’t Hike Rates; Must Nudge Capital Flows By Bearing Hedging Cos Of ECBs: Chetan Ahya | 2 Jun 2026 | CNBC-TV18

00:02:03 | Indian Equity Benchmarks & FII Capital Flight

00:07:35 | Tax Policy & Administration: The FII Capital Gains Debate

00:05:57 | Indian Aviation Under Energy & Airspace Constraints

00:17:00 | US Airlines Scaling Indian Global Capability Centers (GCCs)

00:17:47 | Satellite Internet Realities: Starlink’s India Push vs. Kenya Lessons

Finding Balance: Growth, Income and Liquidity | 1 Jun 2026 | Morgan Stanley

00:00:02 | Global Markets, West Asia Conflict & Economic Indicators

References

Related nuggets

Investing in a Divergent Economy | 1 Jun 2026 | Notes on the Week Ahead | David Kelly | J.P.Morgan

Falling Yields Reinforce Equity Market Resilience | June 1, 2026 | Professor Siegel Weekly Commentary | WisdomTree

RBI Needn’t Hike Rates; Must Nudge Capital Flows By Bearing Hedging Cos Of ECBs: Chetan Ahya | 2 Jun 2026 | CNBC-TV18

00:00:02 | Global Markets, West Asia Conflict & Economic Indicators

References

Related nuggets

Investing in a Divergent Economy | 1 Jun 2026 | Notes on the Week Ahead | David Kelly | J.P.Morgan

Falling Yields Reinforce Equity Market Resilience | June 1, 2026 | Professor Siegel Weekly Commentary | WisdomTree

RBI Needn’t Hike Rates; Must Nudge Capital Flows By Bearing Hedging Cos Of ECBs: Chetan Ahya | 2 Jun 2026 | CNBC-TV18

00:02:03 | Indian Equity Benchmarks & FII Capital Flight

00:07:35 | Tax Policy & Administration: The FII Capital Gains Debate

00:05:57 | Indian Aviation Under Energy & Airspace Constraints

00:17:00 | US Airlines Scaling Indian Global Capability Centers (GCCs)

00:17:47 | Satellite Internet Realities: Starlink’s India Push vs. Kenya Lessons

Finding Balance: Growth, Income and Liquidity | 1 Jun 2026 | Morgan Stanley