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Synopsis This volume is an account of India's financial integration with the world economy which coincides with a period of intense fragility in the global financial environment. India is opening up its capital markets at a time when openness to capital flows is being seriously questioned. The volume analyses the complexities and loopholes in India's reform journey in the face of liberalization of capital movements. India's gradual pace, coordination with domestic financial sector reforms, and approach to the liberalization of its capital account distinguish it from countries such as Chile, Korea and Mexico. This volume aims to answer several critical questions: What constitutes an appropriate strategy for managing capital inflows in India? What are the major stumbling blocks to complete account convertibility? Is the domestic financial sector ready to face the impact of full capital account liberalization? How do impending macroeconomic reforms like fiscal imbalances constrain further liberalization. In answering these questions, the book provides a positive, strategic and normative analysis of monetary and financial governance. It identifies dangers to further liberalization unless key constraints limiting monetary policy responses are removed. The book will be useful for students, teachers, and policymakers who are interested in the issues of macroeconomic management of the Indian economy.