To Be or Not to Be: Is India Prepared to Undertake Fuller Capital Account Convertibility?

12 Pages Posted: 2 Mar 2011

See all articles by Aishwarya Padmanabhan

Aishwarya Padmanabhan

West Bengal National University of Juridical Sciences

Uttara Narayan

Dept of Humanities and Social Sciences, Indian Institute of Technology, Madras; Blavatnik School of Government, University of Oxford

Date Written: February 28, 2011

Abstract

This paper aims to show how India is not yet ready to implement and fully undertake Capital Account Convertibility (CAC) in the wake of economic globalisation. It deals with certain problems relating to CAC, especially in the context of developing countries. It looks at the three main conditions laid down by the Tarapore Committee, comparing them to India’s current macroeconomic position and finally, draws from the experience and lessons to be learnt from other developing countries who have implemented or attempted to undertake full convertibility.

Keywords: capital account convertibility, Tarapore Committee, macroeconomics, liberalisations

JEL Classification: B22, E00, F00

Suggested Citation

Padmanabhan, Aishwarya and Narayan, Uttara and Narayan, Uttara, To Be or Not to Be: Is India Prepared to Undertake Fuller Capital Account Convertibility? (February 28, 2011). Available at SSRN: https://ssrn.com/abstract=1773782 or http://dx.doi.org/10.2139/ssrn.1773782

Aishwarya Padmanabhan (Contact Author)

West Bengal National University of Juridical Sciences ( email )

12, LB Block, Sector III
Salt Lake City
Kolkata, West Bengal 700 064
India

Uttara Narayan

Blavatnik School of Government, University of Oxford ( email )

Mansfield Road
Oxford, Oxfordshire OX1 4AU
United Kingdom

Dept of Humanities and Social Sciences, Indian Institute of Technology, Madras ( email )

Madras
Chennai, 600036
India