Income tax relief impact? Foreign investors flock to Indian bonds, pump record ₹25,800 crore in June

Foreign investors pumped a record approximately 25,800 crore rupees (about 3 billion dollars) into Indian government bonds in June 2026, marking the highest monthly inflow on record under the Fully Accessible Route. The surge followed the government's removal of the 12.5% long-term capital gains tax on government bonds and the 20% withholding tax on bond interest income, alongside the RBI's expansion of the FAR framework to include longer-tenor sovereign bonds. Treasury bills also witnessed record foreign buying of around 12,500 crore rupees, while a decline of over 20% in Brent crude during June further improved the outlook for Indian debt.