It this becomes imperative from a financial stability perspective to have some prudential limits in place. Access to financial markets   One of the key arguments favouring a more open capital account has been the attendant benefits it brings to the development of domestic markets.
It was believed that free capital flows into the financial markets are necessary for efficient allocation of resources and for completion of markets by providing more liquidity. The potency of this argument has at least partly been dented by the crisis which has demonstrated that pursuit of development of financial markets per se cannot be an end in itself.