RBI Data | Q1 FY2025–26 BoP Shows Narrower CAD of USD 2.4 Billion (0.2% of GDP)
SDG 8: Decent Work and Economic Growth | SDG 17: Partnerships for the Goals
Institutions: Reserve Bank of India | Ministry of Finance
The Reserve Bank of India (RBI) has released preliminary data on India’s Balance of Payments (BoP) for Q1 of FY2025–26. The current account deficit (CAD) narrowed to US $2.4 billion (0.2% of GDP), compared with US $8.6 billion (0.9%) in the same quarter last year, while the previous quarter recorded a surplus of US $13.5 billion.
Within the BoP, the merchandise trade deficit widened to US $68.5 billion, but higher services receipts (US $47.9 billion, up from US $39.7 billion) and strong remittance inflows (US $33.2 billion, up from US $28.6 billion) provided offsetting support. Primary income outflows rose to US $12.8 billion. On the capital account, net inflows of US $3.2 billion were led by FDI (US $5.7 billion), FPI (US $1.6 billion), external commercial borrowings (US $3.7 billion), and NRI deposits (US $3.6 billion). Overall, foreign exchange reserves increased by US $4.5 billion during the quarter.
Relevant question for policy stakeholders: How can India further reduce current account vulnerabilities by diversifying exports and sustaining remittance flows amid global uncertainty?
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