Preliminary data on India’s Balance of Payments (BoP) for the second quarter (Q2), i.e., July-September 2019-20, are presented in Statements I (BPM6 format) and II (old format). Key Features of India’s BoP in Q2 of 2019-20 -
India’s Current Account Deficit (CAD) at US$ 6.3 billion (0.9 per cent of GDP) in Q2 of 2019-20 narrowed from US$ 19.0 billion (2.9 per cent of GDP) in Q2 of 2018-19 and US$ 14.2 billion (2.0 per cent of GDP) in the preceding quarter. -
The contraction in the CAD was primarily on account of a lower trade deficit at US$ 38.1 billion as compared with US$ 50.0 billion a year ago. -
Net services receipts increased by 0.9 per cent on a y-o-y basis, on the back of a rise in net earnings from computer, travel and financial services. -
Private transfer receipts, mainly representing remittances by Indians employed overseas, rose to US$ 21.9 billion, increasing by 5.2 per cent from their level a year ago. -
In the financial account, net foreign direct investment was US$ 7.4 billion, almost same level as in Q2 of 2018-19. -
Foreign portfolio investment recorded net inflow of US$ 2.5 billion – as against an outflow of US$ 1.6 billion in Q2 of 2018-19 – on account of net purchases in the debt market. -
Net inflow on account of external commercial borrowings to India was US$ 3.2 billion as compared with US$ 2.0 billion in Q2 of 2018-19. -
There was an accretion of US$ 5.1 billion to the foreign exchange reserves (on BoP basis) as against a depletion of US$ 1.9 billion in Q2 of 2018-19 (Table 1). BoP during April-September 2019-20 (H1 of 2019-20) -
The CAD narrowed to 1.5 per cent of GDP in H1 of 2019-20 from 2.6 per cent in H1 of 2018-19 on the back of a reduction in the trade deficit which shrank to US$ 84.3 billion in H1 of 2019-20 from US$ 95.8 billion in H1 of 2018-19. -
Net invisible receipts were higher in H1 of 2019-20 mainly due to increase in net services earnings and private transfer receipts. -
Net FDI inflows at US$ 21.2 billion in H1 of 2019-20 were higher than US$ 17.0 billion in H1 of 2018-19. -
Portfolio investment recorded a net inflow of US$ 7.3 billion in H1 of 2019-20 as against an outflow of US$ 9.8 billion a year ago. -
In H1 of 2019-20, there was an accretion of US$ 19.1 billion of the foreign exchange reserves (on a BoP basis). | Table 1: Major Items of India's Balance of Payments | | (US$ Billion) | | | July-September 2019 P | July-September 2018 | April-September 2019-20 P | April-September 2018-19 | | | Credit | Debit | Net | Credit | Debit | Net | Credit | Debit | Net | Credit | Debit | Net | | A. Current Account | 161.2 | 167.5 | -6.3 | 160.0 | 179.1 | -19.0 | 321.9 | 342.3 | -20.4 | 315.8 | 350.6 | -34.8 | | 1. Goods | 80.0 | 118.1 | -38.1 | 83.4 | 133.4 | -50.0 | 162.7 | 247.0 | -84.3 | 166.8 | 262.6 | -95.8 | | Of which: | | | | | | | | | | | | | | POL | 10.2 | 29.6 | -19.3 | 11.8 | 35.3 | -23.5 | 21.3 | 64.9 | -43.6 | 23.6 | 70.1 | -46.5 | | 2. Services | 52.4 | 31.9 | 20.4 | 50.1 | 29.8 | 20.3 | 104.6 | 64.1 | 40.5 | 98.3 | 59.4 | 38.9 | | 3. Primary Income | 6.8 | 15.5 | -8.6 | 5.6 | 14.2 | -8.6 | 12.6 | 27.4 | -14.7 | 11.0 | 25.4 | -14.4 | | 4. Secondary Income | 22.0 | 2.0 | 20.0 | 20.9 | 1.5 | 19.4 | 41.9 | 3.9 | 38.0 | 39.7 | 3.3 | 36.4 | | B. Capital Account and Financial Account | 140.3 | 133.4 | 6.9 | 131.4 | 113.0 | 18.5 | 278.3 | 257.5 | 20.8 | 274.0 | 239.4 | 34.6 | | Of which: | | | | | | | | | | | | | | Change in Reserves (Increase (-)/Decrease (+)) | 0.0 | 5.1 | -5.1 | 1.9 | 0.0 | 1.9 | 0.0 | 19.1 | -19.1 | 13.2 | 0.0 | 13.2 | | C. Errors & Omissions (-) (A+B) | | 0.7 | -0.7 | 0.6 | | 0.6 | | 0.3 | -0.3 | 0.3 | | 0.3 | | P: Preliminary | | Note: Total of subcomponents may not tally with aggregate due to rounding off. | (Yogesh Dayal)
Chief General Manager Press Release: 2019-2020/1556 | |