India’s current account deficit narrowed sequentially in the three months from January to March, mainly on the back of a moderation in the trade gap and a lower net outgo of primary income, the Reserve Bank of India said on Wednesday.
The current account deficit stood at $13.4 billion or 1.5 per cent of GDP in the fourth quarter of fiscal year 2021-22, compared with $22.2 billion or 2.6 per cent of GDP in the preceding October-December quarter.
The deficit had stood at $8.1 billion in the same quarter a year ago, the release showed.
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.
The trade deficit widened to $189.5 billion in 2021-22 from $102.2 billion a year ago, which resulted in slippage in the number which is considered a key representation of a country’s external strength, the RBI said.
The Balance of Payments data suggested that goods imports stood at $618.6 billion in 2021-22 as against $398.5 billion in the year-ago period, leading to the widening of the trade deficit.