India's Current Account Deficit Widens to 1.6% in Q2: Report

Mumbai, Dec 5 (PTI) The current account deficit (CAD) for the September quarter is set to widen to 1.6 per cent -- the most in the last seven quarters -- a report said on Thursday.

In absolute terms the July-September CAD will be USD 15 billion, or 1.6 per cent, as against USD 9.8 billion, or 1.1 per cent, in the June quarter, India Ratings and Research said in the report.

The CAD in the second quarter will be the highest since Q3 FY23, where the crucial gap representing the country's external position was USD 16.8 billion, or 2 per cent of the GDP.

The domestic rating agency said merchandise exports shrank 3.9 per cent during the period while goods exports were down to a 12-quarter low of USD 103 billion.

Goods exports declined after three quarters due to subdued demand from major exporting partners such as China, Singapore, Bangladesh, and Australia, it said.

The CAD is moderate to about 1.3 per cent of the GDP in December quarter, Paras Jasrai, its economist and senior analyst, said.