Did the Indian capital controls work as a tool for macroeconomic policy, Ila Patnaik and Ajay Shah. IMF Economic Review, page 439--464, volume 60, 2012.
In 2010 and 2011, there has been a fresh wave of interest in
capital controls. India is one of the few large countries with
a complex system of capital controls, and hence offers an
opportunity to assess the extent to which these help achieve
goals of macroeconomic and financial policy. We find that the
capital controls were associated with poor governance, were
unable to sustain the erstwhile exchange rate regime, and did
not support financial stability. India's experience is thus
inconsistent with the revisionist view of capital controls.
Macroeconomic policy in India has moved away from the erstwhile
strategies, towards greater exchange rate flexibility combined
with capital account liberalisation.