- Image Credit: AP
- Shoppers load groceries in their cars at a Bharti-Walmart store in Chandigarh, India. The nation has opened its market to foreign retailers such as Wal-Mart.
Mumbai: India’s current account deficit shrank by 24 per cent in the April-June period from an all time high in the previous quarter, narrowly returning the balance of payments to surplus after an earlier worrying slide towards dangerous territory.
The Reserve Bank of India data released on Friday showed India ran a balance of payments surplus of $0.5 billion (Dh1.8 billion) in the April-June quarter, versus a deficit of $5.7 billion in the previous three months. In the June quarter last year, India had posted a $5.4 billion surplus.
The current account deficit fell to $16.55 billion in the June quarter, down from an all-time high of $21.76 billion in the March quarter, and also below the $17.54 billion deficit posted in the June quarter last year.
The reduced deficits will be some relief for Prime Minister Manmohan Singh, whose government was reduced to a minority last week by the withdrawal of a coalition ally in protest at a package of reforms aimed at shoring up finances, cutting fuel subsidies and opening the economy further to foreign investment.
Markets were buoyed by the raft of reforms, but India remains in danger of losing its investment grade credit rating and analysts said the government remained under intense pressure to do more.
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