New Delhi, June 5 -- The government's decision to exempt foreign institutional investors (FIIs) from taxes on interest income and capital gains from Indian Government Securities is expected to boost foreign capital inflows and help stabilise market sentiment, according to Neelkanth Mishra, Executive Director for India at the World Bank Headquarters.

In an exclusive interview with ANI, Mishra said the measure is important not only because it can attract investments, but also because it can help ease concerns in the currency market.

"I think more than the investment itself. See, what we have to understand is that the currency market was in a state of panic.... we have seen that the demand for dollars was way higher than what our balance o...