They are deployed opportunistically to stem a surge in inflows or outflows. By their very nature, tactical controls introduce a new element of uncertainty into the calculations of both domestic and foreign stakeholders. India’s approach to capital account management is typically strategic.
If people and governments become convinced once again that it is but a zerosum game, the consequences can be serious. However, as so often in the economics of exchange, it is not a zero-sum game. Good economic reasoning and creative research must be key ingredients of the conversation.