Rupee’s convertibility comes with a caveat

India inched its way closer towards full convertibility of the rupee early last month when finance minister Jaswant Singh unshackled foreign investment by Indian companies, mutual funds and investors. However, the fine print shows that the old control mindset of the Indian authorities has not changed.

For the first time, Indian investors, mutual funds and companies can invest in shares of foreign-listed companies, but there is a caveat.