Finance Ministry expects that India’s current account deficit (CAD) will fall by almost 50% to around $45 billion in the current financial year, mainly on the back of declining gold imports and the narrowing trade deficit. India’s CAD widened to a record high of $88.2 billion or 4.8% of GDP in 2012-13, however during the first half of current fiscal, CAD has narrowed to $26.9 billion or 3.1% of GDP from 4.5% of GDP in the first half of 2012-13.
The ministry further stated that the country is witnessing significant improvement on trade deficit front on account of better performance of exports and contracting imports. During April-December’2013, value of exports increased by 5.94% to $230.34 billion as against $217.42 billion in the same period of previous year. India’s imports also declined by 6.55% to $340.38 billon during April-December’2013 as against $364.24 billion recorded in the same period of previous year. Further, Finance Ministry added that FII inflows remained quite robust during this fiscal and expressed confidence for accretion to foreign exchange reserves. As on January 31, 2014 India’s foreign exchange reserve stood at $291 billion. Besides, Foreign Institutional Investors investing Rs 56,560 crore in equities so far in the current fiscal.
Referring to fiscal deficit front, Finance Ministry has asserted that country’s fiscal deficit is likely to be contained at 4.7% of GDP in 2013-14 because of better- than-expected response to the ongoing auction of telecom spectrum and other supportive measures taken by the government. So far the government has garnered around Rs 56,190 crore from the ongoing auction of 2G radiowaves and the figure is likely to go up further. In the first nine months of this fiscal, Indian fiscal deficit reached Rs 5,16,390 crore or 95.2 per cent of the Rs 5,42,499 crore fiscal target.
The ministry further stated that the country is witnessing significant improvement on trade deficit front on account of better performance of exports and contracting imports. During April-December’2013, value of exports increased by 5.94% to $230.34 billion as against $217.42 billion in the same period of previous year. India’s imports also declined by 6.55% to $340.38 billon during April-December’2013 as against $364.24 billion recorded in the same period of previous year. Further, Finance Ministry added that FII inflows remained quite robust during this fiscal and expressed confidence for accretion to foreign exchange reserves. As on January 31, 2014 India’s foreign exchange reserve stood at $291 billion. Besides, Foreign Institutional Investors investing Rs 56,560 crore in equities so far in the current fiscal.
Referring to fiscal deficit front, Finance Ministry has asserted that country’s fiscal deficit is likely to be contained at 4.7% of GDP in 2013-14 because of better- than-expected response to the ongoing auction of telecom spectrum and other supportive measures taken by the government. So far the government has garnered around Rs 56,190 crore from the ongoing auction of 2G radiowaves and the figure is likely to go up further. In the first nine months of this fiscal, Indian fiscal deficit reached Rs 5,16,390 crore or 95.2 per cent of the Rs 5,42,499 crore fiscal target.
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