kaykay
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India's FY23 CAD now seen under $100 billion on services boost, import slump
In January, India's merchandise trade deficit fell to a 12-month low of $17.8 billion, while the services trade surplus surged to an all-time high
India's current account deficit is now seen falling below $100 billion for 2022-23 after two powerful factors moved in tandem in January.
Last month, India's goods exports contracted again, this time by 6.6 percent on a year-on-year basis to $32.9 billion, while imports also fell.
Merchandise imports in January were down 3.6 percent at $50.7 billion. This resulted in a trade deficit of $17.8 billion — sharply lower than the $22.1 billion in the last month of 2022, but marginally higher than the January 2022 figure of $17.3 billion.
Meanwhile, provisional data showed services exports were nearly 50 percent greater in January at $32.2 billion, while imports rose 19 percent to $15.8 billion.
All in all, India posted a record services trade surplus of $16.5 billion in January.
Arora sees India's "solid" services trade surplus "strongly" offsetting the merchandise trade deficit, likely resulting in a current account deficit of $90 billion for 2022-23, down from her previous estimate of $107 billion.