Logo


IMF wants India to focus on FDI, cautions against relying on global markets

Cautions against relying on global financial markets to its finance current account deficit

Photo: Reuters
Photo: Reuters

The International Monetary Fund (IMF) has cautioned India it should not rely on global financial markets to finance its current account deficit (CAD) when it goes above 3 per cent of gross domestic product (GDP). The Fund basically advised India to rely more on stable sources of foreign inflow — foreign direct investment (FDI). The advice came amid expectations that India's CAD will rise to 2.5 per cent of GDP in the first quarter of 2018-19. On the contentious issue of the rupee’s value, the Fund in its latest external report has noted the real effective ...