Managing Finance in Emerging Economies: The Case of India

摘要

According to pundits such as Nobel Laureate Joseph Stiglitz, India has managed its monetary policy successfully and withstood some of the negative effects of the global economic crisis. According to Research Associate Sunanda Sen, such notions underestimate the systemic risks and social costs embedded in India's liberalized financial sector. Monetary management has not kept up with the need to control inflows of short-term capital, sterilize capital inflows, prevent appreciation in the rupee's real exchange rate, limit cuts in public expenditure, fix interest rates at an acceptable level, and control the financialization of the commodity markets.