India's current-account deficit in January to March worsened to $21.7 billion, a record high, compared to $6.3 billion a year earlier in the same period.
India's Current-Account Deficit Widens - WSJ.com
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India's current-account deficit widened to a record in the January-March period, as exports
slowed and imports climbed, central-bank data showed Friday, increasing the pressure on the country's tenuous external position.
Analysts, however, expect the combination of a weak Indian rupee and lower commodity prices to shrink the current-account gap in coming quarters.
The widest-ever current-account deficit kept India's balance of payments in negative territory for a second consecutive quarter, forcing the Reserve Bank of India to dip into its foreign-exchange reserves.
The data highlight the risks of relying on volatile portfolio capital inflows to fund the current-account deficit, which Asia's third-largest economy after China and Japan runs because of a perennial trade gap.
The current-account deficit in the three months through March was $21.7 billion, or 4.5% of gross domestic product, compared with $6.3 billion a year earlier, or 1.3% of GDP. It was also more than the October-December period's $19.6 billion—the previous record.
The current account includes the trade balance, payments for software exports and worker remittances.
Friday's data showed that India's current-account deficit ballooned to 4.2% of GDP for the last fiscal year, after staying below 3% since 1991.
India's Current-Account Deficit Widens - WSJ.com
-------
India's current-account deficit widened to a record in the January-March period, as exports
slowed and imports climbed, central-bank data showed Friday, increasing the pressure on the country's tenuous external position.
Analysts, however, expect the combination of a weak Indian rupee and lower commodity prices to shrink the current-account gap in coming quarters.
The widest-ever current-account deficit kept India's balance of payments in negative territory for a second consecutive quarter, forcing the Reserve Bank of India to dip into its foreign-exchange reserves.
The data highlight the risks of relying on volatile portfolio capital inflows to fund the current-account deficit, which Asia's third-largest economy after China and Japan runs because of a perennial trade gap.
The current-account deficit in the three months through March was $21.7 billion, or 4.5% of gross domestic product, compared with $6.3 billion a year earlier, or 1.3% of GDP. It was also more than the October-December period's $19.6 billion—the previous record.
The current account includes the trade balance, payments for software exports and worker remittances.
Friday's data showed that India's current-account deficit ballooned to 4.2% of GDP for the last fiscal year, after staying below 3% since 1991.
