India’s CAD moderated marginally to $11.2 billion or 1.2% of GDP year-on-year in the July-September quarter of 2024-25, according to Reserve Bank data released. File
| Photo Credit: Reuters

India’s current account deficit (CAD) moderated marginally to $11.2 billion or 1.2% of GDP year-on-year in the July-September quarter of 2024-25, according to Reserve Bank data released on Friday, December 27, 2024.

The CAD, an indicator of the country’s external payment scenario, was $11.3 billion or 1.3% of GDP during the second quarter of 2023-24.

“India’s current account deficit (CAD) moderated marginally to USD 11.2 billion (1.2 per cent of GDP) in Q2 2024-25 from USD 11.3 billion (1.3 per cent of GDP) in Q2:2023-24,” the RBI said.

During April-September 2024 (H1 2024-25), the current account deficit was $21.4 billion or 1.2% of GDP compared to $20.2 billion (1.2% of GDP) in the year-ago period.

Merchandise trade deficit increased to $75.3 billion in the second quarter of 2024-25 from $64.5 billion in the comparable period of 2023-24, as per the RBI’s data on Balance of Payments.

Net services receipts increased to $44.5 billion in Q2 2024-25 from $39.9 billion a year ago.

Services exports have risen, on a year-on-year basis, across major categories like computer services, business services, travel services and transportation services.

Further, private transfer receipts, mainly representing remittances by Indians employed overseas, rose to $31.9 billion in the July-September quarter in 2024-25 from $28.1 billion in the second quarter of 2023-24, the data showed.

In the financial account, the RBI said net foreign direct investment recorded an outflow of $2.2 billion in Q2 2024-25 compared to $0.8 billion outflow in the corresponding period of 2023-24.

Net inflows under foreign portfolio investment increased to $19.9 billion in Q2 2024-25 from $4.9 billion a year ago.

During April-September 2024, the RBI data showed that net invisible receipts at $119.0 billion were higher in H1 2024-25 against $101 billion a year ago, primarily on account of higher net services receipts.

Also, net FDI inflows at $4.4 billion in H1:2024-25 was higher than $3.9 billion in H1:2023-24.

FPI recorded net inflows of $20.8 billion in H1:2024-25 compared to net inflows of $20.7 billion a year ago.

In H1 2024-25, there was an accretion of $23.8 billion to the foreign exchange reserves (on a BoP basis), the RBI said.

A man stands next to a logo of the Reserve Bank of India (RBI) in Mumbai.
| Photo Credit: Reuters

India’s current account deficit (CAD) widened marginally to $ 9.7 billion (1.1% of GDP) in Q1:2024-25 from $8.9 billion (1.0% of GDP) in Q1:2023-24 and against a surplus of $4.6 billion (0.5% of GDP) in Q4:2023-24, according to dada released by the Reserve Bank of India (RBI) on Monday (September 30, 2024).

The current account surplus for Q4:2023-24 was revised downwards to $4.6 billion from US$ 5.7 billion earlier due to an upward adjustment of customs data on merchandise imports, the RBI said.

“The widening of CAD on a year-on-year (y-o-y) basis was primarily due to a rise in merchandise trade deficit to $ 65.1 billion in Q1:2024-25 from $56.7 billion in Q1:2023-24,” the RBI said.

Net services receipts increased on a y-o-y basis to $39.7 billion in Q1:2024-25 from $ 35.1 billion a year ago. Services exports have risen on a y-o-y basis across major categories such as computer services, business services, travel services and transportation services.

Private transfer receipts, mainly representing remittances by Indians employed overseas, increased to $29.5 billion in Q1:2024-25 from $ 27.1 billion in Q1:2023-24, as per RBI data.

Net outgo on the primary income account, primarily reflecting payments of investment income, increased to $10.7 billion in Q1:2024-25 from $10.2 billion in Q1:2023-24.

In the financial account, net foreign direct investment inflows increased to $6.3 billion in Q1:2024-25 from $ 4.7 billion in the corresponding period of 2023-24.

Net inflows under foreign portfolio investment moderated to $0.9 billion from $ 15.7 billion in Q1:2023-24 and net inflows under external commercial borrowings (ECBs) to India amounted to $1.8 billion in Q1:2024-25, lower than $5.6 billion in the corresponding period a year ago.

Non-resident deposits (NRI deposits) recorded net inflows of $ 4.0 billion, higher than $ 2.2 billion a year ago.

There was an accretion of $5.2 billion to the foreign exchange reserves (on a BoP basis) in Q1:2024-25 as compared with $24.4 billion in Q1:2023-24, the RBI said.