Can LTCG Tax Relief Help Stop FII Outflows From Indian Markets?

Could a moratorium on Long-Term Capital Gains (LTCG) tax attract fresh foreign investment into India? Dinshaw Irani, CEO, Helios Capital, suggests a two- to three-year exemption on LTCG tax for new investments coming through the Foreign Institutional Investor (FII) route, while keeping the existing tax regime unchanged for older investments. The proposal aims to encourage fresh inflows without triggering concerns about existing foreign capital leaving Indian markets. The discussion highlights the government's challenge of balancing tax revenues with the need to attract foreign investors and support the rupee. Could targeted tax relief help revive foreign investor confidence in Indian equities?