India's current account deficit at 2.4% in Q1 of FY2019

Balance of Payment deficit at US$ 11.3 billion in Q1 of FY2019

India's current account deficit (CAD) stood at US$ 15.8 billion (2.4% of GDP) in Q1 of 2018-19 as compared with US$ 15.0 billion (2.5% of GDP) in Q1 of 2017-18.

The widening of the CAD on a year-on-year (y-o-y) basis was primarily on account of a higher trade deficit at US$ 45.7 billion as compared with US$ 41.9 billion a year ago.

Net services receipts increased by 2.1% on a y-o-y basis mainly on the back of a rise in net earnings from software and financial services.

Private transfer receipts, mainly representing remittances by Indians employed overseas, amounted to US$ 18.8 billion, increasing by 16.9% from their level a year ago.

In the financial account, net foreign direct investment at US$ 9.7 billion in Q1 of 2018-19 was higher than US$ 7.1 billion in Q1 of 2017-18.

Portfolio investment recorded net outflow of US$ 8.1 billion in Q1 of 2018-19 - as compared with an inflow of US$ 12.5 billion in Q1 last year - on account of net sales in both the debt and equity markets.

Net receipts on account of non-resident deposits amounted to US$ 3.5 billion in Q1 of 2018-19 as compared with US$ 1.2 billion a year ago.

In Q1 of 2018-19, there was a depletion of US$ 11.3 billion of the foreign exchange reserves (on BoP basis) as against an accretion of US$ 11.4 billion in Q1 of 2017-18.

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