IMF Working Papers

India's Financial Globalisation

By Ila Patnaik, Ajay Shah

January 1, 2011

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Ila Patnaik, and Ajay Shah. India's Financial Globalisation, (USA: International Monetary Fund, 2011) accessed November 21, 2024
Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

India embarked on reintegration with the world economy in the early 1990s. At first, a certain limited opening took place emphasising equity flows by certain kinds of foreign investors. This opening has had myriad interesting implications in terms of both microeconomics and macroeconomics. A dynamic process of change in the economy and in economic policy then came about, with a co-evolution between the system of capital controls, macroeconomic policy, and the internationalisation of firms including the emergence of Indian multinationals.Through this process, de facto openness has risen sharply. De facto openness has implied a loss of monetary policy autonomy when exchange rate pegging was attempted. The exchange rate regime has evolved towards greater flexibility.

Subject: Balance of payments, Capital account, Capital controls, Exchange rate arrangements, Financial markets, Foreign direct investment, Foreign exchange, Stock markets

Keywords: Capital, Capital account, Capital account openness, Capital account restriction, Capital control, Capital controls, Capital controls in India, Capital flows, Capital mobility, Exchange rate arrangements, Financial globalisation, Firm, Firm internationalisation, Foreign direct investment, Foreign direct investment regime, Global, High quality firm, Inbound FDI investor, India, Issues circular, Portfolio flow, Private equity, Reserve bank of India, Stock markets, WP

Publication Details

  • Pages:

    24

  • Volume:

    ---

  • DOI:

    ---

  • Issue:

    ---

  • Series:

    Working Paper No. 2011/007

  • Stock No:

    WPIEA2011007

  • ISBN:

    9781455211852

  • ISSN:

    1018-5941

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