India’s external constraints haven’t disappeared—they are shapeshifting
Second, the current account’s composition matters, as net external financing and gross forex needs are not the same thing. The improvement in India’s current account deficit has been lopsided, driven largely by a growing services surplus and remittance inflows. Meanwhile, the core goods trade deficit, excluding oil and gold imports, has widened, by about 2% of GDP relative to its average over the past decade.
