New Delhi: India’s current account deficit (CAD) declined to $10.5 billion, or 1.2 per cent of the GDP, in the October-December 2023 quarter. The country’s CAD had stood at $11.4 billion during July-September 2023 and $16.8 billion a year ago. Data released by the Reserve Bank of India (RBI) revealed this.
Current account deficit occurs when the value of goods and services imported and other payments exceeds the value of export of goods and services and other receipts by a country in a particular period. Trade deficit is the difference between imports and exports of the country.
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India’s net FDI inflow was at $8.5 billion during April-December 2023. It was lower than $21.6 billion during April-December 2022. The accretion of foreign exchange reserves (on a balance of payment basis) was at $6 billion in October-December (third quarter of the current financial year that ends on March 31). It was at $11.1 billion a year ago.
The merchandise trade deficit at $71.6 billion was marginally higher than $71.3 billion during the third quarter of 2022-23. Services exports grew by 5.2 per cent on a year-on-year basis. The foreign direct investment recorded a net inflow of $4.2 billion, more than double of net inflow of $2 billion in Q3 of 2022-23. Foreign portfolio investment recorded a net inflow of $12 billion in the quarter, higher than $4.6 billion a year ago.
External commercial borrowings to India recorded a net outflow of $2.6 billion in October-December. It was at $2.5 billion a year ago. Non-resident deposits recorded a higher net inflow of $3.9 billion than $2.6 billion a year ago.
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