What happened
India’s current account deficit stood at $5.2 billion in August 2026, narrower than the $6.1 billion recorded in August 2025, according to preliminary Reserve Bank of India (RBI) balance of payments data released on 15 October 2026.
The balance of payments (BoP) is a record of all money flowing between India and the rest of the world. The current account covers trade in goods and services, transfers and income. The capital account covers investment and other financial flows.
Goods and services
- Merchandise exports: $44.7 billion, up from $35.1 billion a year earlier.
- Merchandise imports: $71.3 billion, up from $62.7 billion.
- Net merchandise deficit: $26.6 billion, against $27.6 billion.
- Net services surplus: $16.5 billion, against $15.6 billion. Services exports were $35.5 billion and services imports $18.9 billion.
Transfers and income
Net transfers, which include money sent home by Indians working abroad, were $12.8 billion, up from $12.2 billion. Net income, a negative item, deepened to -$8.0 billion from -$6.3 billion.
Capital account
The capital account recorded a net inflow of $50.6 billion in August 2026, against $0.5 billion in August 2025. Net foreign direct investment (FDI) was $3.3 billion, compared with -$0.1 billion a year earlier. Net FDI into India was $5.2 billion, while Indian FDI abroad was $1.9 billion.
What it means for you
A current account deficit means India paid out more foreign currency than it earned from trade, services, transfers and income. A smaller monthly gap eases the pressure to fund that shortfall through inflows. The August figures show the deficit narrowing even as both exports and imports grew.
If you send money to family in India, transfers are a steady support to the current account. You can check what your remittance is worth with our money transfer calculator.
Background
The five-month picture is less comfortable. For April-August 2026, the current account deficit was $18.3 billion, against $12.8 billion in the same period of 2025. The merchandise deficit widened to $146.0 billion from $124.7 billion, as imports of $366.0 billion outpaced exports of $219.9 billion.
Services remained a cushion, with a net surplus of $85.8 billion in April-August 2026 against $79.9 billion. Net transfers rose to $66.8 billion from $55.6 billion. The capital account surplus for the period was $76.3 billion, compared with $12.0 billion a year earlier, and net FDI was $13.8 billion.
The figures are preliminary and may be revised. RBI notes that sub-components may not add up to totals because of rounding, and that errors and omissions are included under other capital. For related central bank coverage, see our report on the RBI’s forex hedging limit change.
