India's current account deficit rises to USD 23 billion in Q3 of 2021-22
Mar 31, 2022
Mumbai (Maharashtra) [India], March 31 : India's current account deficit (CAD) surged to USD 23 billion in the third quarter of 2021-22 from USD 9.9 billion in the previous quarter and USD 2.2 billion recorded in October-December 2020 period, the Reserve Bank of India (RBI) data showed on Thursday.
The widening of CAD in the third quarter of 2021-22 was mainly on account of a higher trade deficit, the RBI said in a statement.
India's current account deficit (CAD) increased to USD 23.0 billion (2.7 per cent of GDP) in Q3:2021-22 from USD 9.9 billion (1.3 per cent of GDP) in Q2:2021-22 and USD 2.2 billion (0.3 per cent of GDP) a year ago [i.e., Q3:2020-21], the RBI said.
India recorded a current account deficit of 1.2 per cent of GDP in April-December 2021 as against a surplus of 1.7 per cent in April-December 2020 on the back of a sharp increase in the trade deficit.
Net invisible receipts were higher in April-December 2021, on account of higher net receipts of services and private transfers.
Net foreign direct investment (FDI) inflows at USD 26.5 billion in April-December 2021 were lower than USd 41.3 billion in April-December 2020.
Portfolio investment recorded net outflow of USD 1.6 billion during April-December 2021 as against an inflow of USD 28.9 billion a year ago.
In April-December 2021, there was an accretion of USD 63.5 billion to the foreign exchange reserves (on a balance of payment basis).
In October-December 2021 period, private transfer receipts, mainly representing remittances by Indians employed overseas, amounted to USD 23.4 billion, an increase of 13.1 per cent from their level a year ago.
Net outgo from the primary income account, mainly reflecting net overseas investment income payments, increased sequentially as well as on a y-o-y basis.
In the financial account, net foreign direct investment recorded an inflow of USD 5.1 billion, lower than USD 17.4 billion a year ago. Portfolio investment recorded net outflow of USD 5.8 billion as against an inflow of USD 21.2 billion in Q3:2020-21.
Net external commercial borrowings to India recorded an outflow of USD 0.2 billion in Q3:2021-22 as compared with USD 1.6 billion a year ago. Non-resident deposits recorded a net inflow of USD 1.3 billion as compared with USD 3.0 billion in Q3:2020-21.
There was an accretion of USD 0.5 billion to the foreign exchange reserves (on a BoP basis) as compared with USD 32.5 billion in Q3:2020-21, the RBI said.
