Mumbai: India posted a current account surplus of $4.7 billion in April this year, compared with a deficit of $4.8 billion in the same month last year, according to preliminary data released by the Reserve Bank of India (RBI) on Monday. The surplus came despite higher net foreign portfolio investment (FPI) outflows from equity markets.
Services Exports Drive Surplus
The surplus was mainly supported by strong growth in services exports during the month.
Net services exports rose to $18.6 billion in April, compared to $15.9 billion a year earlier. Services exports stood at $37 billion, while imports were $18.4 billion.
Sharp Rise in Remittance Inflows
Net transfers, largely driven by remittances, increased significantly to $16 billion from $9.4 billion in the same month last year. The net income deficit also narrowed to $1.9 billion from $3 billion.
FDI Strengthens, FPI Sees Outflows
On the capital account, foreign direct investment (FDI) showed strong growth, while foreign portfolio investment (FPI) recorded heavy outflows.
- Net FDI rose to $7.4 billion from $1.6 billion last year
- Gross FDI inflows more than doubled to $11.4 billion
- Net FPI recorded an outflow of $8.7 billion
- Banking capital also saw a net outflow of $3.7 billion
Trade Deficit and Quarterly Performance
India had reported a current account surplus of $7.1 billion (0.7% of GDP) in the January–March quarter of 2025–26.
The merchandise trade deficit widened to $83.4 billion in the quarter compared to $59.3 billion a year ago, reflecting continued pressure on imports.
Net services receipts improved to $60.4 billion, supported by strong export performance.
Economists note that India’s external sector remains supported by services exports and remittances, but capital flows and trade deficits may continue to cause volatility in the coming months.