Module: General Practice
Q40: In the context of the International Monetary Fund (IMF), India has accepted the obligations under Article VIII of the IMF Articles of Agreement since August 1994. What does this status signify?
✅ Correct Answer: B
Current Account Convertibility means the freedom to buy or sell foreign exchange for current international transactions (trade, travel, interest payments, etc.) without government restriction.
By accepting Article VIII in August 1994, India committed to: Not imposing restrictions on payments/transfers for current international transactions.
Not engaging in discriminatory currency arrangements or multiple currency practices.
This does not apply to Capital Account transactions (like buying property abroad), which remain regulated under FEMA 1999 (Partial Convertibility).
By accepting Article VIII in August 1994, India committed to: Not imposing restrictions on payments/transfers for current international transactions.
Not engaging in discriminatory currency arrangements or multiple currency practices.
This does not apply to Capital Account transactions (like buying property abroad), which remain regulated under FEMA 1999 (Partial Convertibility).