India's Record Current Account Surplus: A Significant Economic Turnaround

India experienced a current account surplus of USD 5.7 billion in the March quarter, contrasted with a deficit of USD 1.3 billion a year ago. Significant improvements were noted in private transfer receipts and foreign portfolio investments, while net FDI saw a downturn.

India achieved a noteworthy milestone by recording a current account surplus of USD 5.7 billion, accounting for 0.6% of its GDP in the March quarter, as announced by the Reserve Bank of India (RBI) on Monday.

This performance marks a significant recovery from a deficit of USD 1.3 billion, or 0.2% of GDP, in the same period last year. The previous quarter ending December 2023 also saw a larger deficit of USD 8.7 billion.

For the fiscal year 2024 (FY24), the current account deficit narrowed to USD 23.2 billion (0.7% of GDP), significantly down from USD 67 billion (2% of GDP) in the prior fiscal year. The improvement was driven by higher net services receipts and strong remittances by Indians employed overseas.