Q1 current account deficit widens sharply to 2.4% of GDP, says RBI

Widening of CAD primarily due to a higher trade deficit at $41.2 bn, says the central bank

India’s current account deficit (CAD) in the first quarter ended June soared to a four-year high of $14.3 billion, or 2.4 per cent of gross domestic product (GDP), from 0.1 per cent a year ago and 0.6 per cent in the fourth quarter.

The CAD, the difference between imports and exports, was at $0.4 billion a year ago and $3.4 billion in the fourth quarter of 2016-17. 

Despite the high CAD, strong capital flows ensured that the balance of payment surplus was at $11 billion, a two-year high. 

The rise in the CAD was on account of a high trade deficit, $41.2 billion,