India has trained over 3,000 personnel from various cybercrime and police departments to bolster their capabilities in tackling cryptocurrency-related crimes.
According to the Ministry of Home Affairs (MHA)’s annual report, India provided specialized training in cryptocurrency forensics and investigations during the financial year 2022-2023.
A notable aspect of this training involved the Narcotics Control Bureau (NCB), India’s principal law enforcement and intelligence agency in drug law enforcement.
The NCB trained 141 officers, focusing on darknet investigations, cryptocurrencies, and digital footprint analysis, including open-source intelligence and social media analysis.
The bureau has also developed a Core Training Module and five specialized modules for different ranks and civil department officials to standardize drug law enforcement training.
The Indian Cyber Crime Coordination Centre has furthered these efforts by training over 2,800 cyber police officials in crypto forensics and investigations, covering new technologies such as anonymization networks and mobile application misuse in cyberspace.
Simultaneously, India is exploring blockchain technology in the public sector. Hindustan Petroleum (HPCL), a state-run oil and gas company, recently introduced a blockchain system to automate the verification of purchase orders in collaboration with Zupple Labs, a blockchain software firm.
This move demonstrates the broader applications of blockchain beyond cryptocurrencies, aiming to enhance efficiency and transparency in procurement processes.
However, the recent crypto tax policy, including a 30% tax on crypto gains and a 1% tax deduction at source on virtual digital assets purchases, has led to significant shifts in the cryptocurrency market in India.
Following these changes, trading volumes on local exchanges plummeted, and a considerable number of traders moved to international platforms.
According to the Esya Centre, a Delhi-based technology policy think tank, this shift resulted in the offshoring of around $3.8 billion in trading volume, with domestic exchanges losing 81% of their volumes in just four months.
This move also led to an estimated 17 lakh users switching from domestic to foreign exchanges.