According to data released by the Reserve Bank of India (RBI), India’s current account deficit (CAD) widened to $23 billion or 2.7% of GDP for the quarter ended December 2021, from $9.9 billion (of GDP) in the previous quarter. was 1.3%). on Thursday. The data showed the CAD reached $2.2 billion (0.3% of GDP) a year earlier.
“The increase in CAD in Q3 of 2021-22 was mainly on account of higher trade deficit,” RBI said. Net services receipts increased sequentially and y-o-y (y-o-y) basis, driven by strong performance of net exports of computer and business services.
ICRA Chief Economic Aditi Nair said: “We expect the current account deficit to decline somewhat to around $17-$21 billion in Q4 FY2022, with the third wave [of COVID-19 infections] Temporarily reducing certain imports”.
It pointed out that if the ongoing geopolitical tensions between Ukraine and Russia “raise the average price of the Indian crude oil basket to $105/barrel in FY23, CAD is projected to rise to $90-95 billion.” Is”.
Private transfer receipts, which mainly represent remittances by Indians working abroad, amounted to $23.4 billion, an increase of 13.1 per cent from the year-ago level.
Net expenditure from the primary income account, which primarily reflects net foreign investment income payments, increased sequentially as well as on a year-on-year basis.
In the financial account, net foreign direct investment inflows declined from $17.4 billion to $5.1 billion.
Portfolio investments recorded a net outflow of $5.8 billion against an inflow of $21.2 billion
India recorded an outflow of $0.2 billion against $1.6 billion in net external commercial borrowings.
As per RBI data, non-resident deposits registered a net inflow of $1.3 billion as compared to $3 billion in Q3: 2020-21.
On a balance of payments basis, foreign exchange reserves increased by $0.5 billion as against $32.5 billion.