India records $5.7 bn current account surplus in March quarter
Mumbai: India reported a current account surplus of $5.7 billion, or 0.6 per cent of GDP, for the March quarter, as announced by the Reserve Bank of India (RBI) on Monday. This is a significant improvement from the same period last year, which saw a current account deficit of $1.3 billion, or 0.2 per cent of GDP. The previous quarter ending December 2023 recorded a deficit of $8.7 billion, or 1 per cent of GDP.
For the fiscal year 2024, the current account deficit narrowed significantly to $23.2 billion, or 0.7 per cent of GDP, compared to $67 billion, or 2 per cent of GDP, in FY23, according to the RBI’s release on Developments in India’s Balance of Payments.
During January-March 2024, the merchandise trade deficit was $50.9 billion, slightly lower than the $52.6 billion recorded in the same period the previous year.
Net services receipts increased to $42.7 billion from $39.1 billion, supported by a 4.1 per cent growth in the sector. This increase in net services receipts contributed to the current account moving into surplus.
However, the net outgo on the primary income account, which mainly includes investment income payments, rose to $14.8 billion from $12.6 billion a year earlier.
Private transfer receipts, primarily consisting of remittances from Indians working abroad, saw an 11.9 per cent increase, reaching $32 billion in the March quarter.
Non-resident deposits surged to $5.4 billion in January-March, up from $3.6 billion in the same period last year.
Net foreign direct investment (FDI) flows were $2 billion in Q4 FY24, down from $6.4 billion a year earlier.
Foreign portfolio investment recorded a net inflow of $11.4 billion during the quarter, a significant turnaround from a net outflow of $1.7 billion in the same period last year.
Net inflows under external commercial borrowings were $2.6 billion, compared to $1.7 billion a year earlier.
For FY24, portfolio investment saw a net inflow of $44.1 billion, a reversal from an outflow of $5.2 billion in the previous year. In contrast, net FDI plummeted to $9.8 billion from $28 billion in FY23, as reported by the RBI.
