Finally, it is, sometimes, suggested that encouraging outflows would be a good solution to manage surging inflows. Liberalising outflows may not be of great help in the short run because a greater liberalised regime generally attracts more inflows.
Hence, while recourse to some encouragement to outflows such as the liberalisation of overseas investment by our corporates in the real sector is helpful, it has to be combined with other measures to manage the flows depending on their intensity. VI.