Consider the following statements regarding capital account convertibility in India:
Statement-I: A capital account transaction alters the assets or liabilities outside India of residents or within India of non-residents.
Statement-II: India adopted full capital account convertibility after 2008 to attract more foreign investors by offering them greater flexibility and ease of capital movement.
Which one of the following is correct in respect of the above statements?1
Both Statement-I and Statement-II are correct, and Statement-II is the correct explanation for Statement-I.
2
Both Statement-I and Statement-II are correct, but Statement-II is not the correct explanation for Statement-I.
3
Statement-I is incorrect, but Statement-II is correct.
4
Statement-I is correct, but Statement-II is incorrect.