India Swings to Current Account Surplus on Strong Services and Remittances

India posted a current account surplus of about $4.7 billion in the latest period, reversing a deficit of roughly $4.8 billion a year earlier, according to preliminary data from the Reserve Bank of India. The improvement came even as the merchandise trade deficit widened, with the surplus driven by strength in services and inflows from Indians working abroad. Net services exports strengthened to around $18.6 billion, while remittances surged to about $16 billion from $9.4 billion a year earlier, and the net income deficit narrowed. On the capital account, foreign direct investment more than doubled, though net foreign portfolio investment recorded outflows and banking capital turned negative. A current account surplus means the country is earning more from trade in services, income and transfers than it is spending abroad on goods and services, which can support the rupee and ease external financing pressures. The figures underscore the growing importance of India's services exports and its large diaspora to the country's external accounts, providing a buffer against volatility in global trade, capital flows and energy prices.