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India has partial capital account convertibility. This implies that
  1. India will have a negative sovereign credit rating.
  2. Private foreign denominated debt needs to be met by either private export earnings or India’s forex reserves.
Select the correct answer code:
  • a)
    1 only 
  • b)
    2 only 
  • c)
    Both 1 and 2 
  • d)
    Neither 1 nor 2
Correct answer is option 'B'. Can you explain this answer?
Most Upvoted Answer
India has partial capital account convertibility. This implies that In...
  • Capital account convertibility means the freedom to conduct investment transactions without any constraints. Typically, it would mean no restrictions on the amount of rupees you can convert into foreign currency to enable you, an Indian resident, to acquire any foreign asset. Similarly, there should be no restraints on your NRI cousin bringing in any amount of dollars or dirhams to acquire an asset in India.
  • India has come a long way in liberating the capital account transactions in the last three decades and currently has partial capital account convertibility.
  • Since India has partial capital account convertibility, this implies that private foreign denominated debt also needs to be met by either private export earnings or India’s forex reserves.
  • There is no correlation between capital account convertibility and sovereign credit rating.
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Community Answer
India has partial capital account convertibility. This implies that In...
Will need to use its foreign exchange reserves.
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India has partial capital account convertibility. This implies that India will have a negative sovereign credit rating. Private foreign denominated debt needs to be met by either private export earnings or India’s forex reserves.Select the correct answer code:a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'B'. Can you explain this answer?
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India has partial capital account convertibility. This implies that India will have a negative sovereign credit rating. Private foreign denominated debt needs to be met by either private export earnings or India’s forex reserves.Select the correct answer code:a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'B'. Can you explain this answer? for UPSC 2025 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about India has partial capital account convertibility. This implies that India will have a negative sovereign credit rating. Private foreign denominated debt needs to be met by either private export earnings or India’s forex reserves.Select the correct answer code:a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'B'. Can you explain this answer? covers all topics & solutions for UPSC 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for India has partial capital account convertibility. This implies that India will have a negative sovereign credit rating. Private foreign denominated debt needs to be met by either private export earnings or India’s forex reserves.Select the correct answer code:a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'B'. Can you explain this answer?.
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