INSUBCONTINENT EXCLUSIVE:
RBI feels that India is close to achieving its capital account convertibility targetIndia is on the verge of achieving its long standing
target of capital account convertibility, deputy governor of the Reserve Bank of India (RBI) T Rabi Sankar said on Thursday.Addressing an
event of foreign exchange dealers association, Mr Sankar said that the capital account convertibility rate has increased in the
ability to convert domestic currency into foreign currencies and vice versa for making payments for balance of payments (BoP) transactions
normally one year."India has come a long way in achieving increasing levels of convertibility on the capital account
It has broadly achieved the desired outcome for the policy choices it has made, in terms of achieving a stable composition of foreign
capital inflow," he said.Simultaneously he said, the country is also on the cusp of witnessing some fundamental shifts in this space with
greater market integration expected in the near future.Mr Sankar said that the rate of capital account convertibility will also accerate
through measures like freer non-resident access to debt and greater market integration.With this increase comes the responsibility to ensure
that such flows are managed effectively with the right combination of capital flow measures, macro-prudential measures and market
intervention, Mr Sankar noted.On RBI's role he suggested that it is restricted to taking precautionary measures.
