India’s current account deficit in Q3 FY23 reflects sharp sequential correction in CAD to 2.2% of GDP
Download ReportQuantEco Research || Q3 FY23 BoP - From concern to comfort
India’s current account deficit and net balance of payment position in Q3 FY23 reflects dissipation of recent concerns on external sector vulnerability. Lower commodity prices and moderation in demand for imports (while imports from Russia is on a rising trend) and increasing but more importantly is backed by a robust performance of services exports and remittance inflows have been the factors.. Some of this would be sustainable in the near to medium term. The compression in CAD has been significant and taking into recent favorable data revisions, we now revise our CAD estimates for FY23 and FY24 to 2.0% (USD 68 bn) and 1.4% of GDP (USD 53 bn) respectively from 2.6% and 2.0% earlier. As such, the FY23 and FY24 BoP forecast now stands adjusted to -0.5% (USD -17 bn) and 0.3% of GDP (USD 12 bn) respectively.