Balance of Payments
India's CAD at $6.2 billion in June vs $1.2 billion surplus year ago on high trade gap
This story was originally published at 20:10 IST on 14 August 2026
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--RBI: India Jun BoP surplus $2.9 bln vs $400 mln deficit year ago
NEW DELHI – India's current account posted a deficit of $6.2 billion in June, compared with a surplus of $1.2 billion a year ago, due to a wider merchandise trade deficit, data released by the Reserve Bank of India on Friday showed. The current account was in a deficit of $2.0 billion in May.
India's net merchandise trade deficit widened to $30.2 billion in June from $19.2 billion a year ago. Net services trade surplus increased to $17.9 billion in June from $16.2 billion a year ago, while net transfers rose 9.2% on year in June to $11.9 billion.
India's overall balance of payments recorded a surplus of $2.9 billion in June, compared with a deficit of $400 million a year ago. The capital account recorded a surplus of $9.1 billion in June, compared with a deficit of $1.6 billion a year ago, primarily due to banking capital inflows of $8.2 billion and foreign portfolio investment of $2.5 billion.
The improvement in capital account and balance of payments comes following the measures by the RBI and the government, announced in June, to spur foreign inflows. In June, the central bank announced a host of measures to attract foreign capital, including concessional foreign exchange swap facilities for foreign currency non-resident deposits and borrowings by public sector entitites.
Net foreign direct investment inflows were $1.3 billion in June, down over 43% from a year ago.
In the first quarter of the current financial year (Apr-Mar), India's current account recorded a deficit of $3.1 billion, compared with a deficit of $2.9 billion in the corresponding period last year. This was primarily due to sharp increase in merchandise trade deficit to $85.7 billion in the reporting quarter from $68.9 billion.
Services trade surplus in Apr-June rose to $52.2 billion from $47.9 billion a year ago. Net transfers rose to $41.4 billion in the June quarter from $30.9 billion a year ago.
The capital account recorded a deficit of $5.0 billion in Apr-Jun, compared with a surplus of $7.4 billion a year ago. India's overall balance of payments recorded a deficit of $8.1 billion in Apr-Jun, compared with a surplus of $4.5 billion a year ago.
In the March quarter, India's current account surplus fell to $7.1 billion from $13.7 billion a year ago. The current account surplus was 0.7% of GDP in Jan-Mar, down from 1.4% a year ago. End
US$1 = INR 95.43
Reported by Pratiksha
Edited by Saji George Titus
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