The Reserve Bank of India (RBI) on Monday stated that India recorded a current account surplus of USD 5.7 billion, equivalent to 0.6 per cent of Gross Domestic Product (GDP), for the March quarter. This marks a significant improvement from the same period last year, when the current account deficit was USD 1.3 billion or 0.2 per cent of GDP. Additionally, in the preceding quarter ending December 2023, the deficit stood at USD 8.7 billion or 1 per cent of GDP.
For the fiscal year 2023-24 (FY24), the current account deficit has notably decreased to USD 23.2 billion or 0.7 per cent of GDP. This is a substantial reduction compared to the USD 67 billion or 2 per cent of GDP recorded in the previous fiscal year, FY23. The RBI provided these details in its release on the Developments in India’s Balance of Payments.
What RBI data said?
In January-March 2024, the merchandise trade deficit stood at USD 50.9 billion, lower than the USD 52.6 billion a year ago. Net services receipts at USD 42.7 billion were higher than the USD 39.1 billion on the back of a 4.1 per cent growth in the segment, the central bank said, adding that this helped in swinging the current account into the surplus territory. Net outgo on the primary income account, mainly reflecting payments of investment income, increased to USD 14.8 billion from USD 12.6 billion a year ago, the data released by the RBI said.
Private transfer receipts, which mainly represent remittances by Indians employed overseas, grew 11.9 per cent to USD 32 billion in the March quarter.
The non-resident deposits also surged to USD 5.4 billion in January-March compared to USD 3.6 billion in the year-ago period. Net foreign direct investment flows were USD 2 billion in Q4 FY24 against USD 6.4 billion a year ago.
Foreign portfolio investment
Foreign portfolio investment recorded a net inflow of USD 11.4 billion during the quarter compared to a net outflow of USD 1.7 billion a year ago. Net inflows under external commercial borrowings to India were USD 2.6 billion against USD 1.7 billion. In FY24, the portfolio investment recorded a net inflow of USD 44.1 billion against an outflow of USD 5.2 billion a year ago, while net FDI plummeted to USD 9.8 billion from USD 28 billion in FY23, the RBI said.
(With PTI inputs)
ALSO READ: India’s economy grows 7.8 per cent in March quarter, annual growth rate hits 8.2 per cent