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Date : Sep 30, 2020
Developments in India’s Balance of Payments during the First Quarter (April-June) of 2020-21

Preliminary data on India’s balance of payments (BoP) for the first quarter (Q1), i.e., April-June 2020-21, are presented in Statements I (BPM6 format) and II (old format).

Key Features of India’s BoP in Q1 of 2020-21

  • India’s current account balance (CAB) recorded a surplus of US$ 19.8 billion (3.9 per cent of GDP) in Q1 of 2020-21 on top of a surplus of US$ 0.6 billion (0.1 per cent of GDP) in the preceding quarter, i.e., Q4 of 2019-20; a deficit of US$ 15.0 billion (2.1 per cent of GDP) was recorded a year ago [i.e. Q1 of 2019-20].

  • The surplus in the current account in Q1 of 2020-21 was on account of a sharp contraction in the trade deficit to US$ 10.0 billion due to steeper decline in merchandise imports relative to exports on a year-on-year basis.

  • Net services receipts remained stable, primarily on the back of net earnings from computer services.

  • Private transfer receipts, mainly representing remittances by Indians employed overseas, amounted to US$ 18.2 billion, a decline of 8.7 per cent from their level a year ago.

  • Net outgo from the primary income account, primarily reflecting net overseas investment income payments, increased to US$ 7.7 billion from US$ 6.3 billion a year ago.

  • In the financial account, net foreign direct investment recorded outflow of US$ 0.4 billion as against inflows of US$ 14.0 billion in Q1 of 2019-20.

  • Net foreign portfolio investment was US$ 0.6 billion as compared with US$ 4.8 billion in Q1 of 2019-20 as net purchases in the equity market were offset by net sales in the debt segment.

  • With repayments exceeding fresh disbursals, external commercial borrowings to India recorded net outflow of US$ 1.1 billion in Q1 of 2020-21 as against an inflow of US$ 6.0 billion a year ago.

  • Net inflow on account of non-resident deposits increased to US$ 3.0 billion from US$ 2.8 billion in Q1 of 2019-20.

  • There was an accretion of US$ 19.8 billion to the foreign exchange reserves (on a BoP basis) as compared with that of US$ 14.0 billion in Q1 of 2019-20 (Table 1).

Table 1: Major Items of India's Balance of Payments
(US$ billion)
  April-June 2020 P April-June 2019
  Credit Debit Net Credit Debit Net
A. Current Account 122.4 102.6 19.8 160.7 175.7 -15.0
1. Goods 52.3 62.3 -10.0 82.7 129.5 -46.8
  Of which:            
          POL 4.9 13.1 -8.3 11.1 35.4 -24.2
2. Services 46.8 26.3 20.5 52.2 32.1 20.1
3. Primary Income 5.1 12.8 -7.7 5.8 12.1 -6.3
4. Secondary Income 18.2 1.2 17.0 20.0 2.0 18.0
B. Capital Account and Financial Account 126.8 146.1 -19.3 138.3 123.7 14.6
  Of which:            
Change in Reserves [Increase (-)/Decrease (+)] 0.0 19.8 -19.8 0.0 14.0 -14.0
C. Errors & Omissions (-) (A+B)   0.5 -0.5 0.4   0.4
P: Preliminary
Note: Total of subcomponents may not tally with aggregate due to rounding off.

(Yogesh Dayal)     
Chief General Manager

Press Release: 2020-2021/410


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