The government today said full rupee float, which will allow conversion the rupee into foreign currencies, is its ultimate goal, but it does not want to introduce it at one go.
"The full convertibility of the rupee is our ultimate destination and we are taking gradual steps towards this. However, it is felt that it is not the time to jump to that destination at one go now," Finance Minister Pranab Mukherjee told the Lok Sabha in a written reply today.
At present, there are no curbs on rupee conversion for trading with other countries, but there are restrictions for trading into shares etc.
Mukherjee said the country has been following a gradualist approach to liberalisation of its capital account.
The Tarapore panel, he said suggested many pre-conditions like fiscal consolidation, lower inflation and a stronger financial system for before going in for full rupee float.
"The Tarapore Committee did not recommend unlimited opening up of the capital account, but preferred a phased liberalisation of controls on outflows and inflows," the finance minister said.
