India Current Account Widens

India's current account widened to $13.2 billion in the December of 2025 quarter from the $11.3 billion gap on the corresponding period of the previous year. The goods account deficit widened to $93.6 billion in the period from $79.3 billion last year, lifted by a surge in imports as pressure from the US government drove Indian refiners to limit their purchase of cheap Russian oil and switch to more expensive alternatives. In the meantime, the services surplus rose to $57.5 billion from $51.2 billion.

India’s current account deficit narrowed to USD 12.3 billion, or 1.3% of GDP, in the July–September 2025-26 quarter, down from a revised USD 20.8 billion, or 2.2% of GDP, in the same period last fiscal year. The goods deficit eased slightly to USD 87.4 billion from USD 88.5 billion a year ago, while surpluses in services (USD 50.9 billion from USD 44.5 billion) and secondary income (USD 36.5 billion from USD 32.4 billion) increased. The primary income deficit, however, rose to USD 12.2 billion from USD 9.2 billion. For the first half of 2025-26, the current account deficit fell to USD 15.0 billion from USD 25.3 billion, supported mainly by stronger services and secondary income surpluses.

India posted a current account deficit of $2.5 billion in the first quarter of the 2026 financial year, narrowing from the $6.6 billion gap in the corresponding quarter of the previous year to mark the softest deficit in the period since 2021. The development was owed to an increase in the surplus of services ($47.9 billion vs $39.7 billion in FY26Q1) and the secondary income account ($31.0 billion vs $26.3 billion). These were enough to offset a wider goods deficit ($-68.5 billion vs $-63.8 billion) amid higher imports of general goods, in addition to a wider deficit in the primary income account ($-12.8 billion vs $-10.9 billion).