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Soros' caution on full float of rupee

`Capital controls are effective only at the time of crisis'

NEW DELHI: George Soros, global financial speculator and one of the world's richest men, on Tuesday cautioned India against going in for full float of the rupee and said the Government should prevent the economy from getting overheated.

"No, I don't think so,'' Mr. Soros said in reply to a question whether India should have full capital account convertibility of the rupee at this moment.

India should be careful of capital inflows. But, the country should make rules conducive to attract foreign direct investment, Mr. Soros said, adding that he faced many hassles when he wanted to invest in India 12 years ago.

"You are in a booming economy, it is the role of the authorities to prevent the boom from getting excessive to avoid overheating,'' Mr. Soros said.

He, however, said capital controls were effective only at the time of crisis and could not be a perfect arrangement.

Capital controls on currency was not a right way of doing things, but overheating in Indian economy was the concern of the authorities, he said.

He said India was becoming an important country and outside interest in the country was growing.

However, he refused to disclose whether he was going to make some investment in India, saying his portfolio was managed by professionals. — PTI

Book released

Delhi Special Correspondent reports:

Earlier, addressing Indian trade and industry leaders at a meeting organised by the Federation of Indian Chambers of Commerce and Industry (FICCI) and the Shri Ram Centre for Industrial Relations and Human Resources (SRC), Mr. Soros said that, after the release of his latest book, `The age of fallibility: Consequence of the war on terror,' "the U.S. international policy is far removed from reality because of which it pursuing counterproductive policies."

Mr. Soros said its international relations were dictated by power and this was destructive for the prevailing world order. In a situation when markets were global, there were no international institutions to manage rule-based globalisation.

Emphasising the need to strengthen internationals institutions and laws, he expressed concern over proliferation of nuclear weapons.

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