Current Account Deficit May Hit 3-Year High In 2021-22: Report
NDTV
Country's current account deficit is likely to hit a three-year high of 1.8 per cent or $43.81 billion in 2021-22
Country's current account deficit (CAD) is likely to hit a three-year high of 1.8 per cent or $43.81 billion in 2021-22, as against a surplus of 0.9 per cent or $23.91 billion in 2020-21, a report said on Thursday.
According to an assessment by India Ratings, CAD has moderated to $17.3 billion or 1.96 per cent of GDP in the fourth quarter of 2021-22 as against $8.2 billion or 1.03 per cent in the year-ago period, and massively down from $23.02 billion or 2.74 per cent in third quarter, which was a 13-quarter high.
The improvement in the key numbers are due to the remarkable improvement in merchandise exports in 2021-22, when it grew 42.4 per cent as against a negative 7.5 per cent in the pandemic-hit 2020-21.
But exports could face significant headwinds from rising uncertainty and volatility in the global economy primarily because of the spike in commodity prices, especially crude oil after Russia invaded Ukraine, the report warned, and pointed to the lower forecast of global growth by the World Trade Organisation (WTO) which sees the global economy clipping at just about 3 per cent in 2022, down from 4.7 per cent forecast earlier.
