MUMBAI: Portfolio flows in India are the most sensitive to shifts in risk sentiment globally and in an adverse scenario, potential portfolio outflows can average up to 3.2 per cent of GDP or $100 billion (Rs 7.8 lakh crore) in a year, an RBI article said.
The article, titled 'Capital Flows at Risk: India's Experience' published in the RBI's latest bulletin, further said in a 'black swan' event comprising a combination of shocks, potential portfolio outflows can rise to 7.7 per cent of GDP, highlighting the need for maintaining liquid reserves to quell such potential bouts of instability.
