InvestorQ : Why did India’s current account deficit narrow in March 2022 quarter?
Arusha Ray made post

Why did India’s current account deficit narrow in March 2022 quarter?

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2 months ago
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Here are 3 factors that narrowed the current account deficit which narrowed by $7.76 billion in March 2022 quarter compared to the December 2021 quarter.

a) The merchandise trade deficit (in physical goods) narrowed from $-60.4 billion to $-54.5 billion. Exports kept pace with higher imports and higher crude prices.

b) The services surplus for March 2022 quarter improved from $27.8 billion to $28.3 billion. This was on the back of improved software exports in the quarter.

c) Primary outflows towards interest and dividends on investments fell sharply from $11.70 billion in December 2021 quarter to $8.40 billion in the March 2022 quarter.

However, the risk of the current account deficit widening in the June 2022 quarter is still quite strong.

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