Thank you for replying on my behalf.
The problem with our interlocutors is that they will see Individual Items like trade Imbalance and are not prepared to see the Phinal Phigure i.e. the OVERALL BALANCE.
Also they fail to understand that India MOST DEFINITELY HAS A BUDGET DEFICIT.
However, what matters in the end is that India does not go begging to all and sundry for more and more Aid on one pretext or the other.
One should also note that India has, as on 31-12-2009 - a Foreign Debt of USD 221.1 Billion while it had a Foreign Exchange Reserves of USD 283.5 Billion. All these Reserves are held by the Reserve Bank of India and does not take into account the Foreign Exchange held by Commercial Banks in India.
In Comparison on the same date Pakistan had an External Debt of USD 55.675 Billion whereas the Foreign Exchange Reserves were USD 12.005 Billion. All these Foreign Exchange Reserves are held by the State Bank of Pakistan.
However the Figure Bandied about is USD 15.0699 which figure also includes USD 3.7870 Billion being held by Private Investors in Commercial Banks. People will remember that Nawaz Sharrif "Took Over" the Foreign Exchange Accounts of Private Individuals who held "Foreign Exchange Accounts" in Pakistan therby causing endless misery to the Good and Honest People of Pakistan.
Thus in real terms, on 31.12.2009, the Net Pakistani Foreign Debt is USD 55.675 Billion less USD 12.005 Billion which equates to USD 43.670 Billion and Indias has a Net Foreign Exchange Reserves of USD 62.4 Billion. This is the reason for the Indian Rupee being about 85% Stronger than the Pakistani Rupee.
There ends the lesson!
Like Pakistan, India continues to run large twin deficits. If it wasn't for the Indian and Pakistani diaspora sending home $55 billion and $10 billion a year respectively, both countries would be in deeper trouble. The biggest single export of South Asian nations are their people employed abroad.
Overseas remittances offer a lifeline to the poor in both nations.
For example Kerala, one of more advanced states of India lives off remittances and it lacks a manufacturing base. Economists draw parallels with the Philippines and Sri Lanka, which face similar problems.
Similarly, what is sustaining Pakistan are remittances which far exceed IMF loans and all of the "aid" put together.
BBC News - Conundrum of Kerala's struggling economy
Haq's Musings: Remittances Offer Lifeline to Pakistanis