India has a complex multidimensional system of capital controls for foreign currency borrowing by firms. In this paper, we summarise existing regulations, review the outcomes and discuss areas of con- cern and recent policy changes. Unhedged foreign currency  exposure for firms, the complexity and uncertainty in the policy framework as it has evolved, and questions about regulation making processes are highlighted. In an emerging economy with a managed exchange rate and incomplete markets, foreign currency borrowing poses systemic risks when left unhedged by large firms that constitute a significant part of GDP. We identify policy directions to help address these concerns.