Budget 1997-98: Full Text
Capital Account Convertibility
- A little while ago I made a reference to capital account
convertibility. We are proud of our foreign exchange
earners. They have been given the facility of the Export
Earners Foreign Currency (EEFC) Account. At present, the
total amount in these accounts is a modest Rs.2000 crore.
I propose to expand the scope of the account by allowing
the following facilities:
- To open offices abroad and to meet the expenses
- To make investments from the balance in the
account in overseas joint ventures upto the limit
of US$ 15 million, without reference to the RBI.
- I also believe that the time has come for preparatory
work towards capital account convertibility. This is a
cherished goal. It is also a matter of great sensitivity.
Hence, I shall not make any commitment. For the present,
I am asking RBI to appoint a group of experts to lay out
the road map towards capital account convertibility,
prescribe the economic parameters which have to be
achieved at each milestone and work out a detailed time
table for achieving the goal. I believe the appointment
of such a group will send a powerful signal to the world
about our determination to join the ranks of front-line
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