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India's current account surplus narrowed in the last quarter of FY26 to $7.1 billion (0.7% of GDP) compared to $13.7 billion (1.4 per cent of GDP) in the same period last year.
The narrowing of surplus in the last quarter of FY26 was driven by a higher merchandise trade deficit, which came in at $83.4 billion compared to $59.3 billion in Q4 of FY25. Net services receipts increased to $60.4 billion in the January-March quarter of 2025-26 from $53.3 billion in the same period last year. India's current account deficit (CAD) for the fiscal year FY26 stood at 0.6 per cent of GDP compared to similar figures reported in the same period last year. In absolute terms, the deficit expanded to $25.2 billion in FY26 compared to $22.9 billion in the last fiscal year. The net foreign direct investment (FDI) inflows increased to $6.9 billion in FY26 compared to $1 billion in FY25. The net FPI outflows stood at $16.4 billion in FY26 against inflows of $3.6 billion a year ago. India's forex reserves depleted by $23.6 billion in the last financial year compared to $5 billion in FY25, the RBI release said. Union Commerce Minister Piyush Goyal recently said that the Government is taking all the steps to ensure that India's current account deficit doesn't widen. A worsening West Asian conflict and rising oil prices have added pressure on India's import bill further risking a fall in the value of the Rupee. The RBI Governor, Sanjay Malhotra, announced a slew of measures in the recent monetary policy to boost foreign inflows to minimize volatility in rupee. (ANI)
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