Lok Sabha Question No. 697 (UNSTARRED), answered on 2022-12-12
Subject: Current Account Deficit
Ministry: FINANCE
Asked by: Dayanidhi Maran

## GOVERNMENT OF INDIA MINISTRY OF FINANCE

## DEPARTMENT OF ECONOMIC AFFAIRS

## LOK SABHA UNSTARRED QUESTION NO. 697

TO BE ANSWERED ON DECEMBER 12, 2022

## CURRENT ACCOUNT DEFICIT

697. Shri Dayanidhi Maran

Will the Minister of FINANCE be pleased to state:

- (a) the details of the country's Current Account Deficit (CAD) and the major factors behind it;
- (b) whether the Government has conducted any analysis or prepared reports on the said issue of CAD and if so, the details and the outcome thereof;
- (c) the list of net imports, net exports, and trade deficit for the last seven fiscal years, country-wise;
- (d) whether any analysis or report has been prepared or is available with the Government on the trade deficit with China and if so, the details and the outcome thereof;
- (e) the details of the country's net imports and exports itemised quarter-wise for the last seven fiscal years;
- (f) the details of the various sectors of the goods and services industries responsible for high imports and exports; and
- (g) whether the Government has held consultations with the industries and stakeholders regarding the issue and if so, the details thereof?

## ANSWER

## THE MINISTER OF STATE FOR FINANCE (SHRI PANKAJ CHAUDHARY)

- (a) The trend in the movement of India's current account balance is as below:

|            |   Current Account Balance (In US$ billion) |   Current Account Balance (As per cent of GDP) |
|------------|--------------------------------------------|------------------------------------------------|
| 2019-20    |                                      -24.6 |                                           -0.9 |
| 2020-21    |                                       24   |                                            0.9 |
| 2021-22    |                                      -38.7 |                                           -1.2 |
| 2021-22:Q1 |                                        6.6 |                                            0.9 |
| 2022-23:Q1 |                                      -23.9 |                                           -2.8 |

Note:

(-) indicates current account deficit.

Source:

RBI.

India's  current  account  balance  recorded  a  deficit  of  US$  23.9  billion  (2.8  per  cent  of  GDP)  in Q1:2022-23, largely due to the widening of the merchandise trade deficit to US$ 68.6 billion and an increase in net outgo of investment income payments.

- (b) Government's endeavour has always been to ensure macroeconomic stability, which involves seeking high growth in GDP, maintaining low inflation, and ensuring a manageable current account deficit. Government implements policies for achieving such outcomes and reviews the progress from time to time.
- (c)  &  (e):  The  country-wise  and  item-wise  list  of  net  imports,  net  exports  and  trade  deficit  can  be accessed  at  the  website  of  the  Department  of  Commerce,  Ministry  of  Commerce  and  Industry,  at: https://commerce.gov.in/trade-statistics/.
- (d) The Government is regularly monitoring the trade deficit situation, including with respect to China.
- (f) Commodities which are the largest imports and exports of India, as per trade data for April-Sept 2022 available with the Department of Commerce, are as under:

|      | EXPORTS                                                                                               | EXPORTS                           | IMPORTS                                                                                               | IMPORTS                           |
|------|-------------------------------------------------------------------------------------------------------|-----------------------------------|-------------------------------------------------------------------------------------------------------|-----------------------------------|
| Rank | Exported products (HS 2 digit)                                                                        | % share in total exports of India | Imported product (HS 2 digit)                                                                         | % share in total imports of India |
| 1    | Mineral Fuels, Mineral Oils and Products of Their Distillation; Bituminous Substances; Mineral Waxes. | 22.8                              | Mineral Fuels, Mineral Oils and Products of Their Distillation; Bituminous Substances; Mineral Waxes. | 38.5                              |
| 2    | Natural Or Cultured Pearls, Precious or Semiprecious Stones, etc.                                     | 8.9                               | Natural Or Cultured Pearls, Precious or Semiprecious Stones, etc.                                     | 11.3                              |
| 3    | Nuclear Reactors, Boilers, Machinery and Mechanical Appliances; Parts thereof.                        | 5.8                               | Electrical Machinery and Equipment and Parts thereof; etc.                                            | 8.9                               |
| 4    | Electrical Machinery and Equipment and Parts Thereof; etc.                                            | 5.6                               | Nuclear Reactors, Boilers, Machinery and Mechanical Appliances; Parts Thereof.                        | 7.2                               |
| 5    | Organic Chemicals                                                                                     | 4.9                               | Organic Chemicals                                                                                     | 4.2                               |

The top imports and exports of services, for the period April-June, 2022, based on data from RBI, are as under:

|   Rank | Exported services                                      |   %share in total exports of India | Imported services                                      |   %share in total imports of India |
|--------|--------------------------------------------------------|------------------------------------|--------------------------------------------------------|------------------------------------|
|      1 | Telecommunications, computer, and information services |                              46.68 | Other business services                                |                              31.77 |
|      2 | Other business services                                |                              23.33 | Transport                                              |                              26.16 |
|      3 | Transport                                              |                              12.95 | Travel                                                 |                              13.99 |
|      4 | Travel                                                 |                               6.18 | Telecommunications, computer, and information services |                               9.85 |
|      5 | Others n.i.e.                                          |                               4.12 | Charges for the use of intellectual property n.i.e.    |                               5    |

- (g) Yes Sir. Consultations with Export Promotion Councils (EPCs) and stakeholders are held on a regular basis to get their perspectives on the situation of international trade and policy suggestions to further facilitate trade.

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