Understanding India’s Revamped FTA Strategy

By Dipankar Dey | Briefing Paper # 56 | November 23, 2022

After India took a decision not to join either mega-bloc, the Regional Comprehensive Economic Partnership (RCEP) or the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), a sudden reversal in India’s approach towards free trade agreements (FTAs) can be observed from early 2022 onwards. In a span of three months, between mid-February and the third week of May 2022, the Indian government signed two major trade agreements, one with the United Arab Emirates (UAE) and the other with Australia.

What led to the U-turn? Apparently, the US-China trade war, concerns…

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Will RBI’s New Measures Open Forex Floodgates?

By Kavaljit Singh | Briefing Paper # 55 | July 26, 2022

Amid large capital outflows, downward pressure on the rupee and reserve drawdowns, the Reserve Bank of India (RBI) announced on July 6 a slew of measures to attract greater foreign exchange flows to India. “In order to further diversify and expand the sources of forex funding so as to mitigate volatility and dampen global spillovers, it has been decided to undertake measures to enhance forex inflows while ensuring overall macroeconomic and financial stability”, the RBI said in its press release.

The measures are regulatory relaxations aimed at attracting larger…

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Capital Outflows Pose Risks to India’s Macroeconomic and Financial Stability

By Kavaljit Singh | Briefing Paper # 54 | July 1, 2022

For the past nine months, foreign portfolio investors (FPIs) have been on a heavy selling spree in the Indian financial markets. According to data compiled by the National Securities Depository Limited, FPIs have pulled out a whopping Rs.255879 crore (US $33.5 billion) from equity and Rs.16621 crore ($2.1 billion) from debt segments of Indian financial markets, for a total net outflow of Rs.271950 crore ($35.6 billion) over the period October 2021 to June 2022 (see Table 1). In the first half of this calendar year, the total net…

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The What, Where, How and Why of the Indo-Pacific Economic Framework

By Kavaljit Singh | Briefing Paper # 53 | May 27, 2022

On May 23, U.S. President Joe Biden officially launched the Indo-Pacific Economic Framework for Prosperity (IPEF) in Tokyo. Conceived and led by the United States, the IPEF has 13 founding members, including Australia, Brunei, India, Indonesia, Japan, South Korea, Malaysia, New Zealand, the Philippines, Singapore, Thailand, and Vietnam. “The future of 21st century economy is going to largely be written in the Indo-Pacific…We are writing the new rules for 21st economy”, said Mr Biden at the launch event attended in person by Japanese Prime Minister Fumio Kishida and…

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Deciphering the Review of the IMF’s Institutional View on Capital Flows

By Kavaljit Singh | Briefing Paper # 52 | April 5, 2022

On March 30, 2022, the International Monetary Fund published the Review of the Institutional View on the Liberalization and Management of Capital Flows. The review updates the IMF’s Institutional View (IV), adopted in November 2012, followed by guidance notes on capital flows added in April 2013 and December 2015. The IMF’s Institutional View is an important policy document because it provides an analytical framework for the Fund’s policy advice on liberalizing and managing capital flows.

Since its adoption, IMF staff members have applied the IV extensively throughout the…

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