The Economic Survey 2020-21 on Friday projected India’s current account to register a surplus of 2% of the Gross Domestic Product (GDP) in FY21.
"India’s exports and imports saw a sharp contraction in line with the contraction in global trade. The decline in imports outweighed that in exports leading to smaller trade deficit of USD 9.8 billion as compared to $49.2 billion in Q1 last year. India registered a trade surplus in the month of June 2020 after a gap of 18 years. With the unlocking of the economy from June onwards, a gradual revival in India’s merchandise trade got underway. The trade deficit during the April-December, 2020-21 was $57.5 billion as compared to $125.9 billion in the corresponding period last year," the survey said.
The last surplus was recorded in financial year 2002-03 when the exports shrank because of weak economy. The current account balance is the difference between exports and imports of goods and services.
The Economic Survey 2020-21 predicted "V-shaped" economic recovery for the nation, spurred by COVID-19 vaccination programme. India started world's largest coronavirus inoculation drive this month with healthcare workers and frontline workers.
The government is likely to miss its fiscal deficit target of 3.5% of gross domestic product this year, the survey said, adding there’s need for more sustained and calibrated measures to facilitate the process of economic recovery in the new fiscal year.
The survey was tabled in Parliament by Finance Minister Nirmala Sitharaman on Friday ahead of the government's Budget.
The Economic Survey, authored by a team led by Chief Economic Adviser Krishnamurthy Venkata Subramanian, details the state of different sectors of the economy as well as reforms that should be undertaken to accelerate growth.