@abhihet , having gone through your posts and the responses from and generally agreeing with the points being made by @Opus 17 and @Anonymous_ , I get the situation as following:
(a) you a US person ( GreenCard ) have investments in India --- Bonds ( RBI, private , funds, Munis or what ?). Since these interest ( no dividend etc.? ) earnings have already been taxed at source , question is what and how do you recognize here in the USA.
1. Generally , and because you are taxed on your world income no matter where and how earned, you will definitely need to recognize these for the amounts earned in the US tax year ( note that you may need to allocate the amounts to 2021 Calendar since India's business etc. all operate 1 st. April to the 31st. March of the following Calendar ).
2. US-India Tax treaty article 11, covers the interest income taxation and there are obviously carve out for exim bank transactions, business which operate in the "other contracting state" etc. etc. . The only thing that you can hang your hat on is the when both states tax the same interest income, the "other state" may not charge more than 15%. ( i.e. you as a resident of the USA and beneficial owner of interest earnings cannot be charged more than 15% by India ). Thus it does not do anything for the US tax laws -- some other countries indeed do ask US to limit taxes on resident of US whom earns in the other contracting.
3. Therefore , I think the easiest was to tackle this is recognize the gross interest income ( at the then prevailing exchange rate ), allow US to tax this( without asserting any treaty conditions ) , then if the total amount foreign tax ( allocated amount and allocated Indian tax on that income ) is US$ 600 or less , just tell TurboTax that you want the credit and you want the simple method -- ( it US$300 per filer on the form 1040 ). BY doing form 1116, US will recognize the whole amount of foreign tax paid $ for $ but only a percentage would be allowed for the current year ( based on a ratio of foreign income to world income. So there you have it
(b) the question about foreign life insurance proceeds as described by @Opus 17 is and is not applicable . This is because foreign insurance companies are not regulated per US laws and as such are Foreign Passive Investment Company (PFIC). This is the worst type of investment for US persons. You have to recognize Mark- to-market regime on this every Tax/Calendar year as part of your filing. Thus every year on paper you sell and then buy back -- both at market-- these gains and losses have to be recognized. So not know how long you have been a resident and how that affects your earlier filings w.r.t. PFIC reporting.
(c) If you recognize the PFIC, then CA will also treat is as such i.e. ordinary income -- like stocks/ bonds etc.
Is there more I can do for you ?
Namaste ji
pk
