RBI's Reddy concerned over capital inflows

Reserve Bank of India (RBI) governor YV Reddy has voiced his concern over managing large inflows of foreign capital.

"In the context of increasing openness of the economy and a market-determined exchange rate, the large capital inflows witnessed in recent years have posed major challenges to the conduct of monetary and exchange rate management," said Mr Reddy.

"The recent episode of large capital flows prompted a debate in India on the need for exchange rate adjustment," he added.

Foreign fund