India’s Parliament debated bringing asset tokenization into the country’s formal legal framework this week, as lawmakers considered whether digital fractional ownership could expand access to wealth-generating assets.
Summary
- Indian lawmaker Raghav Chadha framed tokenization as a tool to broaden wealth creation for India’s middle class.
- Tokenization allows small investors to access high-value assets with greater liquidity, fewer intermediaries, and reduced paperwork, he argues.
- Policymakers remain cautious due to investor protection, land title complexity, and fragmented laws, leaving the country behind peers like the UAE and Singapore.
Chadha pushes for India’s first dedicated Tokenization Bill
Member of Parliament Raghav Chadha urged the government on Tuesday in the Rajya Sabha to introduce a dedicated Tokenization Bill that would allow assets such as real estate, infrastructure projects, and intellectual property to be divided into digital units and purchased in small portions.
Chadha presented the proposal as a financial inclusion measure, drawing a comparison with India’s Unified Payments Interface, which transformed everyday payments by lowering entry barriers for millions of users, according to parliamentary proceedings.
The lawmaker told Parliament that India’s middle class remains largely limited to savings accounts, fixed deposits, and mutual funds, with little exposure to assets that typically generate higher long-term returns. Chadha stated that tokenization could allow ordinary investors to buy small stakes in office buildings, highways, and other capital-intensive projects, while also providing faster liquidity without relying on brokers or complex paperwork.
Chadha called for dedicated legislation and a regulatory sandbox that would allow new models to be tested under supervision, rather than being forced into existing regulatory frameworks.
India has a population estimated at approximately 1.46 billion people and a median age under 30, according to demographic data. The country has seen sharp reductions in extreme poverty, which is now estimated at around 1% using the $2.15-per-day benchmark. Broader poverty measures show more than a quarter of the population falling under the lower-middle-income poverty line.
Only a smaller portion of household wealth is actively deployed in financial markets, leaving limited room for diversification into assets such as carbon credits, infrastructure, or commercial property, according to financial sector analysts.
India has early experiments in tokenization. In GIFT City, platforms such as Tokeny and Terazo have worked on regulated tokenized real estate structures, typically using special purpose vehicles and public blockchains like Polygon. These efforts operate under existing securities and virtual digital asset rules, rather than a unified tokenization law.
The Reserve Bank of India and the Securities and Exchange Board of India have both allowed limited pilots but have stressed caution, particularly around investor protection and settlement risk, according to regulatory statements.
Maharashtra Chief Minister Devendra Fadnavis stated in November that the state was working toward a framework that could unlock an estimated ₹50 trillion in idle capital by digitizing asset transfers, particularly in Mumbai’s real estate market. The announcement followed RBI disclosures that its wholesale central bank digital currency pilots for financial instruments had improved settlement efficiency.
India trails countries that have moved faster on asset tokenization, according to regulatory comparisons. Jurisdictions such as the UAE, Singapore, Germany, Hong Kong, and the U.S. have adopted clearer legal standards allowing regulated platforms to offer fractional ownership to retail investors.
The Securities and Exchange Commission has approved the Depository Trust and Clearing Corporation’s initiative into blockchain-based markets. In Dubai, property tokenization pilots have reduced entry points from millions of dirhams to a few thousand, according to market data. Singapore’s Project Guardian has focused on institutional-grade frameworks that can later scale to the public.
Indian policymakers have expressed caution about moving quickly, citing complex land titles, fragmented state laws, and data privacy concerns, according to government officials. Tokenization remains narrow in scope, even as crypto adoption at the grassroots level is high.
Source: https://crypto.news/india-lawmaker-proposes-tokenization-bill-real-estate/
