India's FY23 CAD now seen under $100 billion on services boost, import slump

[kaykay]

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

www.moneycontrol.com

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.

 

[SoulSpokesman]

@kaykay

MHTMH. And with USD 70-80 billion FDI, net BOP gap would be only USD 20-30 billion. Manageable.

Regards

 

[datafreak]

I think exports must always be the priority over imports. Most imports are capital goods which might be a short term netaive but long term positive.

 

[SoulSpokesman]

We must boost domestic coal production- that is one import we should completely do without.

Regards

 

[kaykay]

@kaykay

MHTMH. And with USD 70-80 billion FDI, net BOP gap would be only USD 20-30 billion. Manageable.

Regards

Remittances are going to hit 100+ billion USD this time around along with FDI as you mentioned. So yes manageable.

 

[pikkuboss]

Remittances are going to hit 100+ billion USD this time around along with FDI as you mentioned. So yes manageable.

There are outward remittances too. So net remittance will be $70 billion + FDI. We must shun FPI, they have 0 contribution to economy and more of a headache.

 

[SoulSpokesman]

Remittances (net) are included in the CAD figure.

Regards

 

[kaykay]

Remittances (net) are included in the CAD figure.

Regards

Yes. Confused it with trade deficit.

 

[hembo]

Remittances are going to hit 100+ billion USD this time around along with FDI as you mentioned. So yes manageable.

Included in CAD. What I don't like to hear is the contraction of good exports. That too in a covid free environment while last Jan-22 baseline must have been already low. In fact its high time for goods exports to exceed the service export figures. Hoping to see it by 2025.

 

[FuturePAF]

We must boost domestic coal production- that is one import we should completely do without.

Regards

Your domestic coal production is also mostly from the Thar desert? Isn’t that coal also king it’s coal? Around 6000 BTU/lb?

 

[kmc_chacko]

Your domestic coal production is also mostly from the Thar desert? Isn’t that coal also king it’s coal? Around 6000 BTU/lb?

Ministry of Coal, Government of India

This is the official website of Coal Ministry, Government of India. You can find information related Tenders, Notices, latest updates pertaining to Ministry of Coal, Government of India.

coal.gov.in

 

[hembo]

Your domestic coal production is also mostly from the Thar desert? Isn’t that coal also king it’s coal? Around 6000 BTU/lb?

The largest coal producing state in India is Jharkhand, followed by Odisha and Chhattisgarh.

COAL RESERVES:​

(Million tonnes)
State	Measured (331)	Indicated (332)	Inferred (333)	Total Resource
Total	187105.32	147252.18	27053.96	361411.46
Odisha	48572.58	34080.42	5451.6	88104.6
Jharkhand	53245.02	28259.67	5155.41	86660.1
Chhattisgarh	32053.42	40701.35	1436.99	74191.76
West Bengal	17233.88	12858.84	3778.53	33871.25
Madhya Pradesh	14051.66	12722.97	4142.1	30916.73
Telangana	11256.78	8344.35	3433.07	23034.2
Maharashtra	7983.64	3390.48	1846.59	13220.71
Bihar	309.53	4079.69	47.96	4437.18
Andhra Pradesh	920.96	2442.74	778.17	4141.87
Uttar Pradesh	884.04	177.76	0	1061.8
Meghalaya	89.04	16.51	470.93	576.48
Assam	464.78	57.21	3.02	525.01
Nagaland	8.76	21.83	447.72	478.31
Sikkim	0	58.25	42.98	101.23
Arunachal Pradesh	31.23	40.11	18.89	90.23

 

[pikkuboss]

Your domestic coal production is also mostly from the Thar desert? Isn’t that coal also king it’s coal? Around 6000 BTU/lb?

Thar coal is useless, it's not power production grade. Govt of India has banned the use of Thar coals. Pakistan shouldn't also use Thar coal for power generation because either the project itself will fail or it will be uneconomical or the West will sanction you for using polluting coals.

 

[SoulSpokesman]

@FuturePAF

Your domestic coal production is also mostly from the Thar desert? Isn’t that coal also king it’s coal? Around 6000 BTU/lb?

No. Our coal is also low grade (generally 3500 KCal/kg) but not brown coal/lignite (less than 2500KCal/kg) which is found in Thar. We do have some lignite in our part of the Thar in Rajasthan but in smaller amounts that in Sindh.

Regards