Finance Minister Nirmala Sitharaman may propose to exempt Euroclear settlements from tax.

New Delhi: India plans some tax exemptions in its Budget due February, possibly the final step for the nation’s sovereign bonds to be included in global indexes, according to people familiar with the matter.

Finance Minister Nirmala Sitharaman will propose to exempt Euroclear settlements from tax, the people said, asking not to be identified as the plans are private. If lawmakers approve the Budget on schedule, Indian debt could be eligible for index inclusion by the end of March, they added.

A finance ministry spokesman wasn’t immediately available for comment.

The tweak is crucial for inclusion of Indian bonds as Euroclear doesn’t charge capital gains tax on debt transactions. Settlement of Indian bonds on Euroclear, an international securities platform, has been a key demand from index providers such as JPMorgan Chase & Co. 

JPMorgan last month said India’s inclusion in its emerging-market bond index could attract $25 billion of investment from foreign investors. 

Bloomberg LP is the parent company of Bloomberg Index Services Ltd. (BISL), which administers indexes that compete with indexes from other providers.