By our Financial Correspondent
Mumbai, June 25 (IVC) India’s current account balance recorded a surplus of $5.7 billion (0.6 per cent of GDP) in the fourth quarter of the fiscal 2024, against a deficit of $1.3 billion (0.2 per cent of GDP) a year ago as per data released by the Reserve Bank of India (RBI) here yesterday.
The merchandise trade deficit stood at $50.9 billion in the fourth quarter of the financial year 2024 was lower than $52.6 billion a year ago and the fourth quarter services exports grew 4.1 per cent year-on-year on the back of rising software exports, travel and business service , RBI data revealed.
“India’s current account turned to a welcome surplus in the fourth of the financial year 2024 after a gap of ten quarters, exceeding ICAR”s more modest expectations. The turnaround to a surplus from deficit in the year-ago period, was primarily driven by a narrowing in the merchandise trade deficit print to a ten-quarter low of $50.9 billion in Quarter four of the financial year 2024 from $69.9 billion in quarter three of the fiscal 2024” Aditi Nayar , Chief Economist , ICAR said in her comment.
Net services at $42.7 billion was higher than a year ago ($39.1 billion) which contributed to the current account surplus in the quarter four of the financial year2024, it added. As per RBI’s data, net outgo on the primary income account, mainly on payments of investment income rose to $14.8 billion from $12.6 billion year-on-year.
Private transfer receipts , mainly representing remittances by overseas Indians was $32 billion, a rise of 11.9 per cent year-on-year. In the financial account, net foreign direct investment flows were $2 billion in the fourth quarter of the fiscal 2024 compared with $6.4 billion a year ago.
Net foreign portfolio investment recorded an inflow of $11.4 billion in the fourt quarter of the fiscal 2024 from a net outflow of $1.7 billion a year ago.
Non-Resident deposits recorded a higher net inflow of $5.4 billion than $3.6 billionin Q4 FY23. There was an accretion of foreign exchange reserves to the tune of $30.8 billion excluding valuation effects in the fourth quarter of the fiscal 2024 compared with $5.6 billion a year ago.
Overall India’s financial year 2024 current account deficit moderated to $23.2 billion (0.7 per cent of GDP) from $67.0 billion (2% GDP) in the financial year 2023. Net invisibles receipt was higher during the financial year2024 than a year ago, primarily on account of sevices and transfers. In the financial year 2024, portfolio investment recorded a net flow of $44.1 billion against an outflow of $5.2 billion a year ago. Net Foreign Direct inflow in the fiscal 2024 was $ 9.8 billion compared with $28 billion in the fiscal 2023.
