Looks like the budget in 2024 expanded the requirement for TCC (Tax Clearance Certificate) to all Indian residents and also to foreigners who might have any earnings in India.
But a week later, they issued further guidance that it applies to Foreigners (including OCIs) and only "high-risk" Indian citizens. But final rules are not clear and will still need to be worked out. Interestingly, the law puts the burden on airlines to make sure their passengers are all tax cleared. Failure to do so will effectively make the airline/carrier liable to such tax dues. In case of foreign employees working in India, the onus is on their employers.
I don't really understand the purpose of this law. Doesn't every country already have a blacklist for tax evaders? Even worse, it can take a "few" weeks to get the TCC after submitting the appropriate paperwork.