India recorded a current account surplus of $0.6 billion, or 0.1% of GDP, for the January-March quarter, against a deficit of $4.6 billion, or 0.7% of GDP in the year-ago period, the Reserve Bank said on Tuesday.
For the fiscal year 2019-20, the current account deficit narrowed to 0.9% of the GDP, compared with 2.1% in FY2018-19, the central bank said. Lower trade deficit was one of the prime reasons for the improvement in the current account balances both for the March quarter as well as for the whole fiscal year.
The current account balances, which represent the net of the country’s export and imports of goods and services and also payments made to foreign investors or inflows from them, are considered as an important indicator of a country’s external sector.
The Reserve Bank said the surplus in the current account in the March quarter was primarily on account of a lower trade deficit at $35 billion and a sharp rise in net invisible receipts at $35.6 billion as compared with the corresponding period of last year.
The net services receipts increased to $22 billion in March quarter as against the year earlier’s $21.3 billion on the back of a rise in net earnings from computer and travel services on a year-on-year basis, the RBI said.
Private transfer receipts, mainly representing remittances by Indians employed overseas, increased 14.8% to $20.6 billion for the reporting quarter, the RBI said.
The net outgo from the primary income account, which primarily reflects the net overseas investment income payments, decreased to $4.8 billion from $6.9 billion a year ago, the RBI said.
