Preliminary data on India’s balance of payments (BoP) for the third quarter (Q3), i.e., October-December 2020-21, are presented in Statements I (BPM6 format) and II (old format). Key Features of India’s BoP in Q3:2020-21 -
India’s current account balance recorded a deficit of US$ 1.7 billion (0.2 per cent of GDP) in Q3:2020-21 after a surplus of US$ 15.1 billion (2.4 per cent of GDP) in Q2:2020-21 and US$ 19.0 billion (3.7 per cent of GDP) in Q1:2020-21; a deficit of US$ 2.6 billion (0.4 per cent of GDP) was recorded a year ago [i.e. Q3:2019-20]. -
Underlying the current account deficit in Q3:2020-21 was a rise in the merchandise trade deficit to US$ 34.5 billion from US$ 14.8 billion in the preceding quarter, and an increase in net investment income payments. -
Net services receipts increased, both sequentially and on a year-on-year basis, primarily on the back of higher net export earnings from computer services. -
Private transfer receipts, mainly representing remittances by Indians employed overseas, declined marginally on a y-o-y basis but improved sequentially by 1.5 per cent to US$ 20.7 billion in Q3:2020-21. -
Net outgo on the primary income account, primarily reflecting payments of investment income, increased to US$ 10.1 billion from US$ 7.4 billion a year ago. -
In the financial account, net foreign direct investment (FDI) recorded robust inflow of US$ 17.0 billion as compared with US$ 9.7 billion in Q3:2019-20. -
Net foreign portfolio investment (FPI) was US$ 21.2 billion as compared with US$ 7.8 billion in Q3:2019-20, primarily reflecting net purchases by foreign portfolio investors in the equity market. -
With repayments exceeding fresh disbursals, external commercial borrowings to India recorded net outflow of US$ 1.7 billion in Q3:2020-21 as against an inflow of US$ 3.2 billion a year ago. -
Net accretions to non-resident deposits increased to US$ 3.0 billion from US$ 0.8 billion in Q3:2019-20. -
There was an accretion of US$ 32.5 billion to the foreign exchange reserves (on a BoP basis) as compared with that of US$ 21.6 billion in Q3:2019-20 (Table 1). BoP during April-December 2020 -
India recorded a current account surplus of 1.7 per cent of GDP in April-December 2020 as against a deficit of 1.2 per cent in April-December 2019 on the back of a sharp contraction in the trade deficit. -
Net invisible receipts were lower in April-December 2020 due to a moderation in net private transfer receipts and an increase in investment income payments. -
Net FDI inflows at US$ 40.8 billion in April-December 2020 were higher than US$ 31.1 billion in April-December 2019. -
Net FPI inflows stood at US$ 28.9 billion in April-December 2020, higher than US$ 15.1 billion a year ago. -
In April-December 2020, there was an accretion of US$ 83.9 billion to the foreign exchange reserves (on a BoP basis). | Table 1: Major Items of India's Balance of Payments | | (US$ billion) | | | October-December
2020 (P) | October-December
2019 | April-December
2020 (P) | April-December
2019 | | | Credit | Debit | Net | Credit | Debit | Net | Credit | Debit | Net | Credit | Debit | Net | | A. Current Account | 157.4 | 159.2 | -1.7 | 162.8 | 165.4 | -2.6 | 430.6 | 398.2 | 32.4 | 485.0 | 510.2 | -25.1 | | 1. Goods | 77.2 | 111.8 | -34.5 | 81.2 | 117.3 | -36.0 | 205.2 | 265.4 | -60.2 | 243.9 | 366.4 | -122.5 | | Of which: | | | | | | | | | | | | | | POL | 5.5 | 21.9 | -16.4 | 10.9 | 31.5 | -20.6 | 17.6 | 53.8 | -36.3 | 32.1 | 96.7 | -64.6 | | 2. Services | 53.7 | 30.1 | 23.6 | 55.2 | 33.3 | 21.9 | 150.2 | 85.2 | 65.0 | 160.1 | 97.2 | 62.9 | | 3. Primary Income | 5.7 | 15.8 | -10.1 | 5.6 | 12.9 | -7.4 | 15.8 | 42.9 | -27.1 | 18.2 | 40.7 | -22.5 | | 4. Secondary Income | 20.8 | 1.5 | 19.3 | 20.8 | 1.9 | 18.9 | 59.4 | 4.7 | 54.7 | 62.8 | 5.9 | 56.9 | | B. Capital Account and Financial Account | 179.5 | 178.5 | 1.0 | 153.2 | 151.2 | 2.0 | 460.8 | 493.9 | -33.1 | 433.7 | 408.7 | 25.0 | | Of which: | | | | | | | | | | | | | | Change in Reserves (Increase (-)/Decrease (+)) | 0.0 | 32.5 | -32.5 | 0.0 | 21.6 | -21.6 | 0.0 | 83.9 | -83.9 | 0.0 | 40.7 | -40.7 | | C. Errors & Omissions (-) (A+B) | 0.7 | 0.0 | 0.7 | 0.6 | 0.0 | 0.6 | 0.7 | 0.0 | 0.7 | 0.1 | 0.0 | 0.1 | | P: Preliminary | | Note: Total of subcomponents may not tally with aggregate due to rounding off. | (Yogesh Dayal)
Chief General Manager Press Release: 2020-2021/1330 | |