Balance Of Payment Jumps To A Surplus Of $13.2 Bn, It Is A Fifth Consecutive Quarter Of Surplus
Mumbai : The current account deficit (CAD) nearly doubled to $8.2 bn or 1.6% of the GDP in the October-December period, the Reserve Bank data showed on Tuesday. In the same period a year ago, CAD – which is the gap between foreign exchange earned and spent – stood at $4.2 bn or 0.9% of GDP.
On sequential basis, however, the CAD narrowed from $10.1 bn or 2% of GDP in the September quarter.
The Reserve Bank of India (RBI) attributed narrowing of CAD on sequential basis to a pick-up in services exports, improvement in net earnings through travel and software services and lower net outflows under primary income profit, dividend and interest.
But the merchandise trade deficit widened to $39.2 bn during the reporting quarter as exports declined 7.3% against a 4.5% dip in imports.
The inward remittances stood at $17.5 bn and supported the balance of payments with a 12.6% share in the overall receipts, it said.
But the balance of payment stood at a surplus of $13.2 billion during
October-December, a fifth consecutive quarter of
surplus. It was also almost double the $6.9 billion
surplus in the previous quarter.
The net inflows of foreign direct and portfolio investments were somewhat lower compared to the September quarter, while the net loans availed by banks increased by $6.6 bn for the quarter mainly on account of inward repatriations of assets held abroad by banks, it said.
The capital account and financial account surplus came in at $10 bn during the reporting quarter, compared to $4.8 bn in the year-ago quarter.
There was a net accretion of $13.2 bn to the foreign exchange reserves during the quarter, which was double from $6.9 bn in the preceding quarter but lower than the special non-residents’ and banks’ overseas borrowings-boosted figure last year.
For the April-December period, the RBI said there is a considerable improvement in the BoP on account of higher growth in merchandise exports and a marginal rise in imports.
During the first nine months of the fiscal, the CAD shrank to $26.2 bn or 1.7% of GDP against $31.1 bn or 2.3% of GDP during the same period last fiscal, it said.
The trade deficit narrowed to $112.5 bn in the April-December period from $116.9 bn a year-ago.
The net inflows under the capital and financial account rose to $61.7 bn in the first nine months of the fiscal up from $39.6 bn in the year-ago period.
The total accretion to the forex kitty for the first three quarters was $31.3 bn against a low $8.4 bn in the previous fiscal.
