India recorded a current account surplus of $7.1 billion, or 0.7 per cent of GDP, in the January-March quarter of 2025-26, helped by services exports and higher remittances, according to Reserve Bank data released on Monday.
The surplus was $13.7 billion or 1.4 per cent of GDP in the fourth quarter of 2024-25.
However, for the entire fiscal 2025-26, the current account deficit stood at $25.2 billion or 0.6 per cent of GDP compared to $22.9 billion or 0.6 per cent of GDP in 2024-25.
Key Drivers of Q4 Surplus
While the merchandise trade deficit at $83.4 billion in Q4 2025-26 was higher than $59.3 billion in the year-ago quarter, net services receipts increased to $60.4 billion from $53.3 billion.
Services exports increased on a year-on-year basis in major categories, such as computer services and other business services, said RBI’s data on Developments in India’s Balance of Payments during the Fourth Quarter (January-March) of 2025-26.
Personal transfer receipts under the secondary income account, mainly representing remittances by Indians employed overseas, rose to $43.5 billion in Q4 2025-26 from $33.9 billion a year ago.
Financial Account Performance
In the financial account also, foreign direct investment (FDI) recorded a net inflow of $4.2 billion in Q4 2025-26, higher than $0.4 billion in the year-ago period.
On the other hand, foreign portfolio investment (FPI) invested a net of $12 billion in the final quarter of 2025-26 against the outflow of $5.9 billion a year earlier, the RBI said.
The data also showed that net outgo on the primary income account, mainly reflecting payments of investment income, decreased to $11.1 billion in the fourth quarter from $11.9 billion in the January-March period of 2024-25.
Other Significant Data Points
The RBI further said that non-resident deposits (NRI deposits) recorded a net inflow of $3.3 billion compared to $2.8 billion in Q4 2024-25.
“Foreign exchange reserves increased by $7.2 billion (on a BoP basis) in Q4 2025-26 as compared to an accretion of $8.8 billion in Q4 2024-25,” it added.
On India’s Balance of Payments in 2025-26, the data showed that net invisible receipts at $312 billion were higher in 2025-26 than $264.0 billion a year ago, primarily on account of net services receipts and net personal transfers.
Net invisible receipts comprise services, primary income and secondary income accounts.
In 2025-26, foreign exchange reserves depleted by $23.6 billion (on a BoP basis) compared to a depletion of $5 billion a year ago.
Net FDI inflows stood at $6.9 billion in 2025-26.
FPIs recorded net outflows of $16.4 billion in 2025-26 against net inflows of $3.6 billion in the year-ago period.
The depletion in foreign exchange reserves was higher at $23.6 billion against a reduction of $5 billion a year ago.