The story of progress is being written in the country, current account deficit has halved, what is its meaning?

Indian economy is continuously moving on the path of progress. If we look at the latest RBI data, the country's current account deficit has now halved. After all, what does this mean?

The sound of Indian economy is ringing in the world. Recently, during the G20 meeting, the whole world saw the glory of India's economic strength. Now the Reserve Bank of India (RBI) has released the current account deficit figures for the April-June quarter, which has reduced to half compared to last year. How are these beneficial for the Indian economy, let us know…

Reserve Bank of India has informed that in the April-June quarter of the current financial year it has become 9.2 billion dollars. This is equal to 1.1 percent of the country's GDP. Whereas in the same quarter last year, the country's current account deficit was 17.9 billion dollars i.e. equal to 2.1 percent of GDP. However, if we compare the latest figures with that of just a quarter ago i.e. January-March, the current account deficit in the country has increased. Then it was only 1.3 billion dollars. Meanwhile, India's foreign exchange reserves have increased.

Service sector business increased

According to the data, trade in the country's service sector has increased in the April-June quarter and is in surplus of $35.1 billion. Whereas a year ago it was in surplus of $31.1 billion in the same quarter. At the same time, the trade deficit of the country's merchandise i.e. manufacturing sector has already improved. It has now reduced from $63.1 billion to $56.6 billion. The country's trade deficit in April-June 2023 stood at $21.5 billion. It was $32 billion in the same quarter last year.

What is current account deficit?

When imports in a country are more than exports, then the difference between them is called trade deficit. When this is seen in detail as the difference in the balance of payments of a country, then it becomes the current account deficit. In this, payments made for imports, payments coming from exports, foreign exchange reserves and other receipts are combined with it.

Current account deficit is a big indicator of the economy. Along with showing the strength of the country's currency, it also shows the GDP growth. This shows that the country's imports are decreasing and exports are increasing.