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India’s current account deficit eased to $12.3 billion, or 1.3% of GDP, in the July-September quarter from $20.8 billion a year earlier, mainly due to stronger services exports and remittance inflows, preliminary data from the Reserve Bank of India showed on Monday.
In the preceding quarter, the current account had recorded a deficit of $2.4 billion, or 0.2% of GDP.
The merchandise trade deficit narrowed at $87.4 billion versus $88.5 billion a year ago, while net services receipts rose to $50.9 billion from $44.5 billion, driven by computer and business services.
Personal transfers, mainly remittances from overseas Indians, climbed to $38.2 billion from $34.4 billion. However, net outgo on the primary income account widened to $12.2 billion from $9.2 billion.
On the capital side, foreign direct investment posted a net inflow of $2.9 billion compared with an outflow of $2.8 billion a year earlier. Foreign portfolio flows swung to a $5.7 billion outflow from a $19.9 billion inflow, while external commercial borrowings slowed to $1.6 billion from $5 billion. Non-resident deposits fell to $2.5 billion from $6.2 billion.
Foreign exchange reserves declined by $10.9 billion on a balance of payments basis, reversing an accretion of $18.6 billion in the same quarter last year.
For the first half of the fiscal year, the current account deficit narrowed to $15 billion (0.8% of GDP) from $25.3 billion a year ago, while reserves fell by $6.4 billion compared with a $23.8 billion increase.
In the preceding quarter, the current account had recorded a deficit of $2.4 billion, or 0.2% of GDP.
The merchandise trade deficit narrowed at $87.4 billion versus $88.5 billion a year ago, while net services receipts rose to $50.9 billion from $44.5 billion, driven by computer and business services.
Personal transfers, mainly remittances from overseas Indians, climbed to $38.2 billion from $34.4 billion. However, net outgo on the primary income account widened to $12.2 billion from $9.2 billion.
On the capital side, foreign direct investment posted a net inflow of $2.9 billion compared with an outflow of $2.8 billion a year earlier. Foreign portfolio flows swung to a $5.7 billion outflow from a $19.9 billion inflow, while external commercial borrowings slowed to $1.6 billion from $5 billion. Non-resident deposits fell to $2.5 billion from $6.2 billion.
Foreign exchange reserves declined by $10.9 billion on a balance of payments basis, reversing an accretion of $18.6 billion in the same quarter last year.
For the first half of the fiscal year, the current account deficit narrowed to $15 billion (0.8% of GDP) from $25.3 billion a year ago, while reserves fell by $6.4 billion compared with a $23.8 billion increase.
