Goldman Sachs Forecasts India's BoP Surplus by 2026 Amid Global Uncertainties

Goldman Sachs is optimistic about India's external sector, predicting a balance of payments (BoP) surplus by 2026 despite recent rupee weakness. This outlook is supported by falling oil import dependency, robust remittances and services exports, and governmental measures to boost foreign investment amid geopolitical uncertainties.

Goldman Sachs has expressed a positive outlook on India's external sector, forecasting a balance of payments (BoP) surplus by 2026, buoyed by strong remittances and services exports, despite recent rupee depreciation. The report suggests that India's external fundamentals are stronger than perceived, with geopolitical uncertainties mainly causing the rupee's weakness.

The investment bank reported a current account surplus of USD 7 billion in Q1 2026 and expects India to end the year with a reduced current account deficit of USD 46 billion, or 1.3% of GDP. This is significantly lower than the previous estimate of USD 78 billion. Key factors include decreased oil import volumes due to improved energy efficiency and policy measures to curb gold imports.

Goldman Sachs also acknowledged government and Reserve Bank of India initiatives aimed at attracting foreign capital, predicting USD 60 billion in inflows from these measures. While a BoP surplus is anticipated, a notable rupee appreciation is unlikely as the RBI is projected to absorb the foreign currency through reserve accumulation. Overall, the report portrays a resilient outlook for India's BoP despite global challenges.