Comparing India and China, the 75-year-old speculator warned India against devaluing its currency: “India should not devalue its currency,” because protectionism is a rising force in the US. “If you go on that route, you will not succeed. It will increase protectionism.”

China is under pressure on its devalued currency, he said. “Being an investor, I would certainly go for political stability. It is about time China moved from prosperity to democracy. India already has this advantage.”

Soros added, “India can attract FDI and increase the inflow of foreign investment if it creates the right conditions. A lot has to be done in terms of infrastructure to attract more FDI.”

While celebrating the Indo-US nuclear deal, he said India should now help prevent nuclear proliferation: “In a situation when markets are global and there are no international institutions India had a great responsibility in adhering to non-proliferation.”

Speaking at the release of his latest book, “The Age of Fallibility: Consequence of the War on Terror”, Soros mulled over his theory of reflexivity, which guided him in making and giving money. “The general theory is that financial markets tend towards equilibrium, and on the whole, discount the future correctly, but I believe that markets cannot possibly discount the future correctly because they do not merely discount the future, they help shape it,” he said.

In certain circumstances, financial markets can affect the so-called fundamentals, which they are supposed to reflect, he said: “When that happens, markets enter into a state of dynamic disequilibrium and behave quite differently from what would be considered normal by the theory of efficient markets.” According to him, “Such boom or bust sequences do not arise very often, but when they do, they can be very disruptive, exactly because they affect the fundamentals of the economy.” Like it happened in the case of Indonesia when financial crisis changed into a political crisis, he pointed out.