29 March 2025 (Punjab Khabarnama Bureau): India’s current account deficit (CAD) inched up to USD 11.5 billion, or 1.1 per cent of GDP, in the December quarter from USD 10.4 billion (1.1 per cent of GDP) in the year-ago period, mainly due to higher trade deficit, according to RBI data released on Friday.
However, the CAD in the December quarter of 2024-25 has moderated from USD 16.7 billion (1.8 per cent of GDP) in the preceding quarter of the fiscal year.
“India’s current account deficit (CAD) increased to US$ 11.5 billion (1.1 per cent of GDP) in Q3:2024-25 from US$ 10.4 billion (1.1 per cent of GDP) in Q3:2023-24 but moderated from US$ 16.7 billion (1.8 per cent of GDP) in Q2:2024-25.2,” said the RBI’s data on Developments in India’s Balance of Payments.
Merchandise trade deficit increased to USD 79.2 billion in the October-December period of 2024-25 from USD 71.6 billion in year-ago period.
The CAD widened to USD 37 billion (1.3 per cent of GDP) during April-December 2024 from USD 30.6 billion (1.1 per cent of GDP) during the corresponding period of last year, primarily on account of a higher merchandise trade deficit, the Reserve Bank of India said.
In the third quarter, net services receipts increased to USD 51.2 billion from USD 45 billion a year ago. Services exports have risen on a year-on-year basis across all major categories.
Fiscal deficit at 85.8% of annual target
The Centre’s fiscal deficit touched 85.8% of the annual target by the end of February, according to the data released by the CGA on Friday. In actual terms, the fiscal deficit — the gap between expenditure and revenue — was Rs 13,46,852 crore during the April-February 2024-25 period. In absolute terms, the fiscal deficit for the financial year is estimated at Rs 15.69 lakh crore.
Summary: India’s current account deficit rises to $11.5 billion in Q3 due to higher trade deficit, while fiscal deficit reaches 85.8% of target.