India’s current account deficit (CAD) narrowed to $8.3 billion in the second quarter of 2023-24, according to data released on December 26 by the Reserve Bank of India (RBI).
As per the data, the CAD in July-September amounted to 1.0 percent of India’s GDP.
“Underlying the lower current account deficit on a year-on-year basis in July-September 2023 was the narrowing of merchandise trade deficit to $61.0 billion from $78.3 billion in July-September 2022,” the RBI said.
The CAD in April-June 2023 was $9.2 billion, or 1.1 percent of GDP. In July-September 2022, the deficit stood at a huge $30.9 billion, or 3.8 percent of GDP.
| DETAILS OF INDIA’S BALANCE OF PAYMENTS (IN BILLIONS OF US DOLLARS) | ||
| JUL-SEP 2023 | APR-JUN 2023 | |
| Current account deficit | 8.3 | 9.2 |
| Goods trade deficit | 61.0 | 56.6 |
| Services trade surplus | 40.0 | 35.1 |
| Travel | -1.2 | -3.1 |
| Computer services | 35.2 | 33.9 |
| Professional, consulting services | 11.6 | 11.5 |
| Workers’ remittances | 14.6 | 14.5 |
While the merchandise trade deficit was significantly lower compared to the year-ago quarter, it was $4.4 billion higher from April-June. However, the rise in the goods trade deficit was cancelled out by a $4.8 billion quarter-on-quarter increase in the services trade surplus to $40.0 billion.
“Services exports grew by 4.2 percent on a year-on-year basis on the back of rising exports of software, business and travel services,” the RBI noted.