The reversal of capital flows taking place as part of the global deleveraging process has put pressure on our forex markets. Together, the global credit crunch and de-leveraging were reflected at home in the sharp fluctuation in the overnight money market rates in October 2008 and the depreciation of the rupee. The outlook for India, going forward, is mixed.
As is well known, the ratio of gross government debt to GDP in Japan is the highest among developed countries.