Key Points
Investment bank and financial services major Goldman Sachs on Tuesday revised India's current account deficit (CAD) forecasts for calendar year (CY) 2024 to 1.3% of the GDP, from 1.9% of the GDP estimated earlier, on the back of lower oil prices and higher-than-expected services exports during the year..
Goldman Sachs also revised India's CAD forecast for CY 2023 to 1% of the country's GDP from 1.3% estimated earlier..
In a report titled, 'Asia in Focus - India: Flow and stock cushion for external balances', Goldman Sachs Economic Research said Indias external balances remain favourable with a combination of low current account deficit, strong public market capital flows, adequate forex reserves and low external debt..
While the current account measures the flow of trade, including goods, services and investments in and out of a country, a trade deficit, the largest component of the current account deficit (CAD), occurs when the value of the goods and services a country imports exceeds that of its exports..
In 2024, a reduction in India's CAD can be attributable to a 0.7% reduction in oil trade deficit, 0.2% increase in services trade surplus, 0.2% increase in non-oil trade deficit and 0.1% reduction in primary income, Goldman Sachs said in the report..
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