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Capital flows and current account deficit (CAD) are related as capital flows can help finance a country’s current account deficit. However, excessive reliance on capital flows to finance a current account deficit can also be risky. Evaluate.

 

9. Capital flows and current account deficit (CAD) are related as capital flows can help finance a country’s current account deficit. However, excessive reliance on capital flows to finance a current account deficit can also be risky. Evaluate.

Reference: Indian Express