Brave New World? The Politics of International Finance in Brazil and India

Abstract

The financial reputations of Brazil and India have undergone remarkable transitions since the early 1990s. At that time, Brazilian inflation soared beyond a thousand percent annually following a decade of increasingly desperate, and ultimately failed, emergency stabilization plans. In 1991, India suffered its worst monetary crisis in decades. Panicked investors tried to take money out of the country, very tight capital controls notwithstanding, while the government was forced to devalue the rupee by almost 19 percent. Only 20 years later, much had changed. By the time of the global financial crisis (GFC) of 2008–2009, both countries were acknowledged as significant global economic and political players, and in November 2008 Brazilian President Lula da Silva and Indian Prime Minister Manmohan Singh joined a select group of other senior world leaders at the first G20 Summit.