India's current account deficit up 2.7% in Q3

Mumbai: India's current account deficit widened to $23 billion or 2.7 per cent of the GDP in the December quarter, the Reserve Bank said on Thursday.

The health of current account, which is a key indicator of a country's external strength, has deteriorated when compared to the preceding September quarter as well as the year-ago period.

The deficit was at $9.9 billion or 1.3 per cent of the GDP in the second quarter of this fiscal while the same stood at $2.2 billion or 0.3 per cent of the GDP in the year-ago period, the data on Balance of Payments showed.

The widening of the current account deficit for the December quarter was attributed by the central bank to pressures on the trade deficit front, with the gap on that front increasing to $60.4 billion due to rising imports.

Net services receipts increased, both sequentially and on a year-on-year (y-o-y) basis, on the back of robust performance of net exports of computer and business services.

For the first nine months of the current fiscal, the current account deficit came at 1.2 per cent of the GDP as against a surplus of 1.7 per cent in the April-December 2020 period, as per the data.

Meanwhile, the Union government is looking to raise Rs 8.45 lakh crore through borrowing in the first half of 2022-23 to fund the revenue gap for reviving the economy, the Finance Ministry said on Thursday.

Out of gross market borrowing of Rs 14.31 lakh crore estimated for FY2022-23, Rs 8.45 lakh crore is planned to be borrowed in the first half (H1), an official statement said.

As per the Budget document, the gross market borrowing through dated securities for 2022-23 is Rs 14,95,000 crore. Taking into account the switch operations conducted on January 28, 2022, the gross market borrowing through dated securities for 2022-23 is expected at Rs 14,31,352 crore, it said.

The borrowing is scheduled to be completed in 26 weekly tranches of Rs 32,000-33,000 crore, it said.

It further said, the borrowing will be spread under 2, 5, 7, 10, 14, 30 and 40 year securities and Floating Rate Bonds of various tenors.