The aftershocks of the crisis have made supervisors and regulators look inwards  2  Report of the Committee on Fuller capital Account Convertibility, Reserve Bank of India, 2006. 3  The Foreign Exchange Regulation Act, 1973 was replaced by the Foreign Exchange Management Act in 1999.
4  Increased capital flows can lead to widening of the CAD, appreciation of the domestic currency (exchange rate appreciation) as well as the building up of increased inflationary pressures in the domestic economy.