Question

Which among the following committee is connected with the capital account convertibility of Indian rupee?

• A. Tarapore committee
• B. Tiwari committee
• C. Chellaiah committee
• D. Narasimham committee

Answer 1

Answer:

A. Tarapore committee

Read Explanation:

• The Committee on Capital Account Convertibility (CAC) or Tarapore Committee was constituted by the Reserve Bank of India for suggesting a roadmap on full convertibility of Rupee on Capital Account.
• The committee submitted its report in May 1997. 

 

• The terms of reference for the committee included
  1. To examine implications of fuller capital account convertibility on monetary and exchange rate management, financial markets, and financial system
  2. To study the implications of dollarisation in India of domestic assets and liabilities and internationalization of the Indian rupee
  3. To provide a comprehensive medium-term operational framework for fuller capital account convertibility taking into account the implications and progress in revenue and fiscal deficit of both center and states
  4. To survey regulatory framework in countries that have advanced towards fuller capital account convertibility
• The committee in this regard laid emphasis on improving the Regulatory and supervisory standards across the banking system before making the rupee more freely tradeable.

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