India's Outdated Foreign-Exchange Policy

From today's WSJ: "Rupee Reform"

Despite these achievements, India's whole approach to foreign-exchange control is badly outdated, a point occasionally recognized in the report itself. The system was invented during World War II, strengthened in the late 1950s and made truly draconian in the early 1970s by former Prime Minister Indira Gandhi. It is animated by the view that foreign exchange is the property of the state, and that Indian residents are constantly poised to mount a run against the rupee.