India’s Current Account Deficit Jumps 7-fold in April-June Quarter
IANS 28 September 2023
India's current account deficit (CAD) jumped 7-fold to US$9.2bn (billion) in the April-June quarter compared to the corresponding figure of US$1,3bn in the preceding quarter, according to Reserve Bank of India (RBI) data released on Thursday.
 
"The widening of CAD on a quarter-on-quarter basis was primarily on account of a higher trade deficit coupled with a lower surplus in net services and decline in private transfer receipts," RBI said.
 
"Net services receipts decreased sequentially, primarily due to a decline in exports of computer, travel and business services."
 
Merchandise trade deficit widened to US$56.6 billion in the quarter, from US$52.6 billion in the preceding quarter, but was less than the year-ago deficit of US$63.1 billion.
 
Private transfer receipts, which are mainly remittances by Indians employed overseas, moderated to US$27.1 billion from US$28.6 billion.
 
CAD for April-June quarter of 2023-24 works out to 1.1% of GDP while in January-March it was a mere 0.2% of GDP.
 
In April-June 2022, the figure stood at US$17.9 billion, or 2.1% of GDP.
 
According to Emkay Global Financial Services lead economist Madhavi Arora, the July-September quarter will see a "substantial widening of CAD" on account of higher oil, higher core imports and further slowing of services exports.
 
"All of this will imply July-September 2023 CAD/GDP ratio could be more than double of April-June 2023 - ranging from 2.4%-2.6%," Arora said.
 
Aditi Nayar, ICRA's chief economist, also forecast a widening of the CAD to US$19 billion-US$21 billion, or 2.3% of GDP, in July-September 2023.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
Comments
Free Helpline
Legal Credit
Feedback