Should India go for Capital Account Convertibility?
By Paul
What does John Williamson, the father of the Washington Consensus think;
“I therefore see a series of reasons for India to take a go-slow approach in moving to liberalise the capital account. That it would be wise to liberalise one day I do not doubt. That there are some liberalizing measures that should be made early – of FDI, of portfolio investment, of small private transactions – I find compelling. But there are many other liberalizing reforms – from electricity pricing to making the courts work expeditiously to pruning the fiscal deficit – that deserve to be priorities over complete capital account liberalisation for the next 10 years (at least). At this stage full capital account liberalization promises no large benefits, while it increases the risk of things going badly wrong.”
The Economic and Political Weekly have an interesting debate on the capital account convertibility issue in India.
Related Links;
Pablo points to another article by Williamson on the Indian economy. Listen a discussion with Williamson on the Washington Consensus.
Charles Wheelan talks about taking his students to India on an International Policy Practicum – interesting idea for teaching economic policy.
World Economic Forum- India Summit. See also India posts at New Economist and Indian Economy blog.
A Survey of Business in India from the latest edition of The Economist; This survey will argue that Indian business can play a big part in delivering faster growth, but only if the government helps. The successes of the past 15 years have been, in a sense, the easy part. Many of the bars that caged the Indian tiger have been removed, leaving the beast free to roam and roar. In particular, India has been able to exploit its great comparative advantage in an era of broadband communications and globalisation: its wealth of technically adept, English-speaking talent. Now, however, further reforms are needed. Here is an interview with the author.
Indians on the Indian economy (multimedia);
Y.V. Reddy, Governor, Reserve Bank of India, Professor B.B. Bhattacharya, Vice-Chancellor of Jawaharlal Nehru University, New Delhi
P. Chidambaram, Finance Minister of India on U.S.-India Economic Relations and the Evolving World Economy. And here is the latest budget speech.