RBI’s concessional swap facility has attracted $20.72 billion so far, led by FCNR (B) deposits, helping strengthen foreign exchange buffers
India’s current account deficit and capital outflows highlight the need for durable foreign investment rather than dependence on volatile short-term flows
Foreign direct investment is the preferred source of capital, but declining net FDI shows the need to create conditions that attract and retain investors
Higher foreign exchange reserves can reduce speculative pressure on the rupee, but they should not be used to defend exchange rates against fundamentals
Reducing imports through protectionist measures may raise input costs, hurt competitiveness and weaken India’s ability to integrate with global markets
India needs policies that encourage investment, improve competitiveness and maintain macroeconomic stability amid changing global conditions