{"id":123379,"date":"2021-08-04T16:03:06","date_gmt":"2021-08-04T10:33:06","guid":{"rendered":"https:\/\/blog.forumias.com\/?page_id=123379"},"modified":"2021-08-04T16:03:06","modified_gmt":"2021-08-04T10:33:06","slug":"capital-account-convertibility","status":"publish","type":"page","link":"https:\/\/forumias.com\/blog\/capital-account-convertibility\/","title":{"rendered":"Capital Account Convertibility"},"content":{"rendered":"<p>To understand Capital Account Convertibility, we first need to understand Balance of Payments (BoP).<\/p>\n<p><strong>About BoP<\/strong><\/p>\n<ul>\n<li>The balance of payments is a statement of all transactions made between a country and the outside world.<\/li>\n<li>It consists of two accounts \u2014 <strong>current<\/strong> and <strong>capital account.<\/strong>\n<ul>\n<li>Current account deals mainly with <strong>import<\/strong> and <strong>export of goods <\/strong>and<strong> services<\/strong><\/li>\n<li>Capital account deals with <strong>cross-border movement of capital by way of investments <\/strong>and <strong>loans.<\/strong><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<p><strong>What is Current Account Convertibility?<\/strong><\/p>\n<p>Current account convertibility refers to the freedom to convert your rupees into other internationally accepted currencies and vice versa without any restrictions whenever you make payments.<\/p>\n<p><strong>What is Capital Account Convertibility?<\/strong><\/p>\n<p>Similarly, capital account convertibility means the freedom to conduct investment transactions without any constraints.<\/p>\n<ul>\n<li>Typically, it means <strong>no restrictions on the amount of rupees you can convert into foreign currency<\/strong> to enable you, an Indian resident, to acquire any foreign asset.<\/li>\n<li>Similarly, there should be <strong>no restraints on any NRIs bringing in any amount of dollars or dirhams to acquire an asset in India<\/strong>.<\/li>\n<li>Currently India has <span style=\"text-decoration: underline;\">partial capital account convertibility.<\/span><\/li>\n<li>Developing countries are usually cautious in opening up their capital account because inflows and outflows of the foreign and domestic capital are<strong> prone to volatility<\/strong>. This can lead to excessive appreciation\/depreciation of their currency and <strong>impact the monetary <\/strong>and <strong>financial stability<\/strong>.<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>To understand Capital Account Convertibility, we first need to understand Balance of Payments (BoP). About BoP The balance of payments is a statement of all transactions made between a country and the outside world. It consists of two accounts \u2014 current and capital account. Current account deals mainly with import and export of goods and&hellip; <a class=\"more-link\" href=\"https:\/\/forumias.com\/blog\/capital-account-convertibility\/\">Continue reading <span class=\"screen-reader-text\">Capital Account Convertibility<\/span><\/a><\/p>\n","protected":false},"author":10328,"featured_media":0,"parent":0,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"class_list":["post-123379","page","type-page","status-publish","hentry","entry"],"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/pages\/123379","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/pages"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/page"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/10328"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=123379"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/pages\/123379\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=123379"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}