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Increase in trade gap, slow services exports growth hike CAD

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Press Trust of India Mumbai
Last Updated : Jan 20 2013 | 2:49 AM IST

Increase in trade gap and slow growth in services exports have pushed the country's current account deficit (CAD) to $32.7 billion during the first half of the current fiscal.

However, as a proportion of GDP, the CAD at 3.6% was a shade lower than 3.7% in the first half of the preceding year, the RBI said in its report 'India's Quarterly International Investment Position'.

The CAD includes deficit in external trade of goods, services, besides net investment income.

"During H1 of 2011-12, there has been an increase in absolute size of CAD to $32.7 billion, reflecting widening of trade deficit as well as moderation of growth in exports of services," it said.

It said that despite higher growth in exports as compare to imports, the trade gap during July-September 2011 widened to $43.9 billion as against $21.9 billion in the same period last year.

During the April-August period this fiscal, the country's cumulative exports of services amounted to $56.64 billion.

The RBI also said that net financial inflows moderated at $17.9 billion during July-September period of this fiscal as compared to $18.3 billion in the same period last year.

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First Published: Dec 30 2011 | 8:16 PM IST

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