India’s current account surplus narrows to $7.1 billion: Here’s what’s happening
On a sequential basis, the current account showed a $22.6 billion improvement, moving from a $15.5 billion deficit in October-December 2025 to a $7.1 billion surplus in January-March 2026.
- Jun 9, 2026,
- Updated Jun 9, 2026 9:42 AM IST
India's current account surplus narrowed to $7.1 billion in the January-March 2026 quarter from $13.7 billion a year earlier. This was due to a surge in gold imports and a worsening merchandise trade deficit, which outweighed gains in services exports and remittance inflows. The surplus fell to 0.7% of GDP from 1.4% in the same period last year.
On a sequential basis, the current account showed a $22.6 billion improvement, moving from a $15.5 billion deficit in October-December 2025 to a $7.1 billion surplus in January-March 2026. This was mainly driven by an improvement in the goods balance, with the deficit narrowing by $12.4 billion from $95.9 billion to $83.4 billion.
Net services receipts increased to $60.4 billion in January-March 2026 from $53.3 billion a year earlier. Personal transfer receipts under the secondary income account rose to $43.5 billion from $33.9 billion. In the financial account, foreign direct investment recorded a net inflow of $4.2 billion, up from $0.4 billion a year earlier, while foreign portfolio investment saw a net outflow of $12 billion, compared with an outflow of $5.9 billion in the corresponding period.
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The narrowing of the surplus from a year earlier was mainly due to a widening goods trade deficit, which increased by $24.1 billion from $59.3 billion in January-March 2025 to $83.4 billion in January-March 2026. This was led by a rise in non-monetary gold imports, with outflows increasing from $9.5 billion to $22.6 billion, causing a negative impact of $13.1 billion. The general merchandise trade balance also worsened by $11.4 billion as exports fell by $3.7 billion to $112.6 billion and imports rose by $7.7 billion to $174 billion.
Partly offsetting this, net secondary income increased by $9.7 billion from $31.5 billion to $41.3 billion, supported by higher remittance inflows. The services surplus also expanded, led by computer services where net receipts rose by $5.6 billion to $47.1 billion, supported by a $6.4 billion increase in exports. Professional and management consulting services also recorded gains, with the surplus rising by $3.2 billion to $19.7 billion on the back of a $4 billion increase in exports.
India's current account surplus narrowed to $7.1 billion in the January-March 2026 quarter from $13.7 billion a year earlier. This was due to a surge in gold imports and a worsening merchandise trade deficit, which outweighed gains in services exports and remittance inflows. The surplus fell to 0.7% of GDP from 1.4% in the same period last year.
On a sequential basis, the current account showed a $22.6 billion improvement, moving from a $15.5 billion deficit in October-December 2025 to a $7.1 billion surplus in January-March 2026. This was mainly driven by an improvement in the goods balance, with the deficit narrowing by $12.4 billion from $95.9 billion to $83.4 billion.
Net services receipts increased to $60.4 billion in January-March 2026 from $53.3 billion a year earlier. Personal transfer receipts under the secondary income account rose to $43.5 billion from $33.9 billion. In the financial account, foreign direct investment recorded a net inflow of $4.2 billion, up from $0.4 billion a year earlier, while foreign portfolio investment saw a net outflow of $12 billion, compared with an outflow of $5.9 billion in the corresponding period.
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The narrowing of the surplus from a year earlier was mainly due to a widening goods trade deficit, which increased by $24.1 billion from $59.3 billion in January-March 2025 to $83.4 billion in January-March 2026. This was led by a rise in non-monetary gold imports, with outflows increasing from $9.5 billion to $22.6 billion, causing a negative impact of $13.1 billion. The general merchandise trade balance also worsened by $11.4 billion as exports fell by $3.7 billion to $112.6 billion and imports rose by $7.7 billion to $174 billion.
Partly offsetting this, net secondary income increased by $9.7 billion from $31.5 billion to $41.3 billion, supported by higher remittance inflows. The services surplus also expanded, led by computer services where net receipts rose by $5.6 billion to $47.1 billion, supported by a $6.4 billion increase in exports. Professional and management consulting services also recorded gains, with the surplus rising by $3.2 billion to $19.7 billion on the back of a $4 billion increase in exports.