Call on capital account convertibility depends on economic scene

NEW DELHI: The government today said progress on capital account convertibility, which allows a foreign investor to repatriate his money into its local currency, will depend on how the domestic macro-economic conditions as well as global financial situations evolve.

"The capital account openness is being progressively liberalised in keeping with the macro economic situation and the requirements of Indian industries, individuals and financial sectors."

"... progress on capital account convertibility will depend on how the domestic macro-economic conditions as well as global financial situations evolve," Minister of State for Finance Jayant Sinha said in a written reply to Rajya Sabha.

Sinha added that there is no target date for achieving full capital account convertibility.

Reserve Bank of India (RBI) Governor Raghuram Rajan had recently said that the central bank is looking at allowing full capital account convertibility in a few years.

Stating that the RBI was fairly open to capital inflows, the Governor had said: "The only place today that we have some restrictions is inflows into debt, especially very short-term debt."

Replying to a separate query, Sinha said RBI has allowed Star and Premier Trading Houses to import gold as per entitlement without any end use restrictions.

Elaborating further, the Minister said Rajesh Exports Ltd imported gold worth Rs 18,440.90 crore and M D Overseas Ltd imported gold worth Rs 6,562 crore in financial year 2013-14.