The capital account surplus widened to $27.7 billion in July 2026, nearly eight times the $3.5 billion recorded in July 2025.
India’s balance of payments (BoP) received a significant boost in July 2026 as non-resident Indian (NRI) deposits under the FCNR(B) scheme surged to $33.5 billion, accounting for a substantial share of the country’s capital account surplus during the month.
The capital account surplus widened to $27.7 billion in July 2026, nearly eight times the $3.5 billion recorded in July 2025. Dollar denominated bank deposits from NRIs contributed to most of this.
Without the RBI’s special scheme, NRI deposits would have remained at their usual monthly level of $1 billion. Combined with a $15 billion outflow in other bank capital, this would have pushed the capital account into a $4.8 billion deficit. When added to the $7 billion current account deficit, India’s overall BoP would have faced an $11.8 billion deficit, which would have marked the third month of deficit had it not been for FCNR(B) deposits.
RBI’s special deposit scheme attracted $127 billion in NRI deposits, with more than 26% of the inflows recorded in July 2026. This helped keep the capital account in a $27.7 billion surplus and the overall BoP at a $20.8 billion surplus during the reporting month.
“FCNR(B) inflows and more of External Commercial Borrowings (ECB) inflows for a few more months kept the current month and the whole fiscal year comfortable for the balance of payment. This can be a one time comfort and may not be available next year,” said Madan Sabnavis, Chief Economist of Bank of Baroda.
Focussing on FDI is the crux and FII outflows should slow down and turn positive for the capital account to be in a self-sustaining surplus, he said. Given the global conditions , it may be difficult for significant inflows of FII or FDI to come in. This can mean a continued pressure on the foreign exchange reserves, Mr. Sabnavis added.
Published – September 16, 2026 09:58 pm IST
