##ify in the months ahead. 11. it is heartening that there is coordination among developed countries in the management of the crisis. that is welcome and necessary, but not sufficient. in as much as emerging and developing economies are likely to be increasingly impacted by the crisis, going forward two things are necessary. first, in managing the crisis, the implications of that management for emerging and developing economies should be explicitly factored in. second, emerging and developing economies should be taken into confidence and consulted whenever the policies and actions of the developed countries have implications for them.

y v reddy : issues in managing capital account liberalisation presentation by dr y v reddy, deputy governor of the reserve bank of india, at commonwealth secretariat - world bank conference on developing countries and global financial architecture, held in london, on 23 june 2000. * * * the objectives of this presentation are : ( i ) to suggest the need of some of the developing countries for managing capital account, implying elements of control, regulation and liberalisation as appropriate ; ( ii ) to emphasise the importance of both international and national context in the management of capital account ; ( iii ) to outline the contours of control and regulatory framework and the possible use of these in prioritising capital flows while suggesting the dynamic elements needed to enable liberalisation ; ( iv ) to elaborate the linkages with other external sector policies, while considering the appropriate control and regulatory framework or liberalisation ; ( v ) to highlight the complementary policies that are necessary while considering liberalisation of capital account. this presentation is from the perspective of policy making in developing countries, and is drawn mainly from the indian experience. need it is currently well recognised that although global capital flows have a potential for improving efficiency and growth prospects, they can also trigger instability, due to a variety of reasons. the objective of current deliberations on the international financial architecture is to enhance efficiency of such flows while avoiding, to the extent possible, instability, and managing instability if and when it occurs. these issues are assessed essentially from the view point of developing countries, which, as a group has tended to be more vulnerable to instability arising out of capital flows. though there are some differences of opinion as to whether liberalisation of capital account would necessarily add to growth prospects of developing countries, there are several developments in regard to international trade in goods and services, international business, technology, cross - border flows of capital, etc. that would necessitate a more active management of capital account, with a view to continuously assessing the costs and benefits of liberalisation vis - a - vis control or regulation. in the current debate on international financial architecture, there is no settled position on several of the actions being considered. in respect of liberalisation of capital account, however, there appears to be a broad consensus, viz. such a liberalisation is desirable, should be gradual, well - sequenced and undertaken in conjunction with several other measures at micro and macro level. in most cases, the desirability of limiting total external debt, especially short - term is generally