Financial liberalization in India: the return of an old familiar ghost- Washington Consensus

Mohan, Deepanshu (2014) Financial liberalization in India: the return of an old familiar ghost- Washington Consensus. International Journal of Arts and Sciences, 7 (3). pp. 355-368. ISSN 1944-6934

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his research paper provides a macroeconomic commentary on India’s current economic position which has highlighted structural weaknesses in its macroeconomic fundamentals. In the current state of policy paralysis, a decline in the foreign direct investment has considered Indian policymakers to move slowly and steadily towards Fuller Capital Account Convertibility (FCAC) -a rudimentary feature of the Washington Consensus of the 1980s. India, in the past has acted boldly refuting IMF’s stand on FCAC and other Washington Consensus type policies by exercising certain capital controls to maintain a system of partial capital account convertibility. This was one of the main reasons why India unlike the rest of the world did not enter into a state of deep recession post the US financial meltdown. The option of FCAC being considered by the policy makers to drive more investment into the economy poses a lot of pertinent questions like- Is this necessary? If yes, then how feasible and sustainable would an investment driven growth achieved through FCAC be for any one sector.

Item Type: Article
Keywords: Capital Mobility | Capital Controls | Fiscal Consolidation | Current Account Deficit
Subjects: Social Sciences and humanities > Social Sciences > Social Sciences (General)
JGU School/Centre: Jindal School of International Affairs
Depositing User: Gena Veineithem
Date Deposited: 19 Apr 2022 10:26
Last Modified: 19 Apr 2022 10:26
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