India’s current account deficit narrowed to $5.2 billion in August from $6.1 billion a year earlier, helped by a lower merchandise trade deficit and a higher surplus in services trade, according to preliminary RBI data.
Mumbai, October 15 — India’s current account deficit (CAD) narrowed to $5.2 billion in August 2026, compared with $6.1 billion in the same month last year, supported by an improvement in the merchandise trade balance and stronger services surplus.
The merchandise trade deficit declined to $26.6 billion from $27.6 billion a year earlier. Merchandise exports increased to $44.7 billion from $35.1 billion, while imports rose to $71.3 billion from $62.7 billion.
India’s services trade surplus increased to $16.5 billion in August from $15.6 billion a year ago. Services exports rose to $35.5 billion, while imports increased to $18.9 billion.
Net transfers, including remittances, also improved to $12.8 billion from $12.2 billion. However, the net deficit in the income account widened to $8 billion, compared with $6.3 billion in August 2025.
For the April-August 2026 period, the current account deficit widened to $18.3 billion, from $12.8 billion during the corresponding period of the previous year.
The merchandise trade deficit for the five-month period increased to $146 billion, compared with $124.7 billion a year earlier, while the services surplus rose to $85.8 billion from $79.9 billion.
Net transfers during April-August also increased to $66.8 billion from $55.6 billion.
On the capital account, net foreign direct investment inflows stood at $3.3 billion in August, compared with a net outflow of $0.1 billion a year earlier.
Net foreign portfolio investment also turned positive, recording an inflow of $1.7 billion, compared with an outflow of $2.6 billion in August 2025.
The overall balance of payments recorded a surplus of $45.4 billion in August, compared with a deficit of $5.6 billion a year ago. During April-August 2026, the overall balance of payments showed a surplus of $58 billion, against a deficit of $0.8 billion in the corresponding period last year.
