Current Account Surplus

What is the news?

India’s current account surplus moderated to $15.5 billion (2.4% of GDP) in the second quarter compared with a $19.2-billion surplus (3.8% of GDP) in the April-June quarter.
The country had recorded a deficit of $7.6 billion for the quarter ended June, 2019, as per balance of payment data released by the RBI.

Balance of Payments (BoP)

The balance of payments (BoP) record the transactions in goods, services and assets between residents of a country with the rest of the world.

1) Current Account

It records exports and imports in goods and services and transfer payments.
Trade in services denoted as invisible trade includes both

Factor income = interest, profits and dividends on our assets abroad minus the income foreigners earn on assets they own in India.
Non-factor income = shipping, banking, insurance, tourism, software services, etc.

Transfer payments are receipts which the residents of a country receive ‘for free, without having to make any present or future payments in return (non-debt). They consist of remittances, gifts and grants.
The balance of exports and imports of goods is referred to as the trade balance (visible). Adding Trade in services and net transfers to the trade balance, we get the Current Account Balance.

2) Capital Account

The capital account records all international purchases and sales of assets such as money, stocks, bonds, etc.

It includes the following:

Foreign investment in India (FDI, FII, ADR, Direct purchase of land or assets)
External commercial borrowing (IMF, WB, ADB etc.),
External assistance & Grants etc.
Indian Diaspora maintains deposits in foreign currency in India known as NRI deposit.

Source: TH

Join Our Telegram

Govt missions in other countries

UDAN Scheme for UPSC

Oceanic Anoxic Event 1a and MASS EXTINCTION

25 Dec, 24
SHARE

Oceanic Anoxic Event 1a from the Paris Basin (Environment) Paper-3 PMP OAE 1a refers to a period during the Cretaceous Period (145 million years ago and ended 66 million years ago) when Earth's oceans became depleted of oxygen, causing a significant disruption in marine life. Cause: The event is believed to have been

Viksit Panchayat Karmayogi (Good governance)

26 Dec, 24
SHARE

Viksit Panchayat Karmayogi (Good governance) Governance GS PAPER-2 PMP Dr. Jitendra Singh launched the ‘Viksit Panchayat Karmayogi’ initiative on Good Governance Day, celebrated to mark the 100th birth anniversary of former Prime Minister Atal Bihari Vajpayee. The initiative, which is part of the broader ‘Prashasan Gaon

Major programmes to control Air Pollution

23 Dec, 24
SHARE

Major programmes to control Air Pollution National Clean Air Programme? It was launched by the Ministry of Environment, Forests and Climate Change (MoEFCC) in January 2019. It is the first-ever effort in the country to frame a national framework for air quality management with a time-bound reduction target. The

Air pollution and Air quality Measures in India

21 Dec, 24
SHARE

Air pollution and Air quality Measures in India (Environment) GS Paper-3 P-M-P Air pollution may be defined as the presence of any solid, liquid or gaseous substance including noise and radioactive radiation in the atmosphere in such concentration that may be directly and/or indirectly injurious to humans or other l

Geopolitical Significance of Ports

20 Dec, 24
SHARE

Geopolitical Significance of Ports (IR) Act as geopolitical assets: Ports enhance the projection of strategic reach, which helps strengthen the country’s control over important sea and energy supply routes. E.g. Indian Navy’s staging base at Agalega Islands will enable marine patrols