Does Modi want to prevent middle-class Indians from investing abroad?
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On Tuesday, Zee Business put out a significant piece of news on its TV network and website. The Reserve Bank of India, Zee reported, is proposing modifications to India’s liberalised remittance scheme that would include ending automatic capital account outflows.
Capital account funds are used to buy assets abroad, so it would mean that Indians would be unable to invest in foreign stocks.
Why would India take such a drastic step, reminiscent of the days of the License Permit Raj, when the state restricted foreign exchange allocations for private citizens?
This Zee Business Report says
— Neil Borate (@ActusDei) October 27, 2026
1) RBI has asked govt to completely end capital account outflows under automatic route (will need RBI permission henceforth)
2) Current account flows capped at 50 lakh
If true, it effectively ends US investing for Indians https://t.co/Oypt1Zj1KW
A significant trial balloon
First though, is a caveat with respect to the news itself. Since it is based on an unidentified source, it does not refer to a final decision taken by...