India's Current Account Deficit declined to $10.5 billion in October-December 2023: RBI
By Team Asianet Newsable | First Published Mar 26, 2024, 7:48 PM ISTThe RBI also revealed that India's net Foreign Direct Investment (FDI) inflow during April-December 2023 was notably lower at $8.5 billion compared to $21.6 billion in the same period of the previous year.
India's Current Account Deficit (CAD) witnessed a decline, standing at $10.5 billion or 1.2 per cent of the GDP during the October-December 2023 quarter, as per the latest RBI data released on Tuesday. This figure represents a decrease from $11.4 billion recorded in July-September 2023 and $16.8 billion a year earlier.
The RBI also revealed that India's net Foreign Direct Investment (FDI) inflow during April-December 2023 was notably lower at $8.5 billion compared to $21.6 billion in the same period of the previous year.
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Additionally, the accretion of foreign exchange reserves, based on balance of payment, amounted to $6 billion in the third quarter of the current fiscal year, down from $11.1 billion during the corresponding period last year.
Although the merchandise trade deficit marginally increased to $71.6 billion from $71.3 billion in the third quarter of 2022-23, the growth in services exports by 5.2 per cent, particularly in software, business, and travel services, contributed to offsetting the current account deficit.
In terms of the financial account, foreign direct investment saw a significant net inflow of $4.2 billion, doubling from $2 billion in the Q3 of 2022-23. Moreover, foreign portfolio investment observed a substantial net inflow of $12 billion during the quarter, compared to $4.6 billion a year ago.
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However, external commercial borrowings to India experienced a net outflow of $2.6 billion in October-December, contrasting with a net outflow of $2.5 billion in the previous year. Conversely, non-resident deposits recorded a higher net inflow of $3.9 billion, up from $2.6 billion in the corresponding period of the previous year.
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