The Indian government’s recent clarification on tax regulations for domestic venture capital funds states that exits will be classified as capital gains. This decision is part of the upcoming Budget 2025, aiming to provide greater clarity and incentivize investments in the venture capital sector. By categorizing exits as capital gains, the government seeks to enhance the attractiveness of venture capital as a viable investment option, potentially stimulating growth and innovation within the Indian economy. This move reflects the government’s commitment to supporting the startup ecosystem and fostering a robust investment climate.