India’s BoP surplus jumped to $45 billion in August, driven by massive FCNR inflows. The FCNR window, which closed on August 31, brought in around $133 billion in deposits. Net NRI deposits surged to $83 billion, helping the capital account. Meanwhile, the current account deficit narrowed to $5.2 billion in August.

In contrast, the year-ago month saw a depletion of $5.6 billion from the reserves on a BoP basis. The BoP was in a surplus of $20.8 billion in July.

With NRI deposits surging in July and August, the BoP surplus rose to $58 billion in the first five months of FY27 compared to a deficit of $0.8 billion in the corresponding period a year ago.

The FCNR window, which closed on August 31, brought in around $133 billion worth of deposits into India. This is expected to support the BoP in FY27 while the current account is seen widening on higher energy prices and imports.

Net NRI deposits jumped to $83 billion in August from $1 billion a year ago. This led to a rise in net banking capital to $64.7 billion in August and the capital account surplus to $50.6 billion during the month and $76.3 billion in April-August. In August 2025, the capital account surplus was just $0.5 billion.

Net foreign direct investment (FDI) and foreign portfolio inflows turned positive in August, supporting the capital account surplus.

Net FDI inflows rose to $3.3 billion in August compared to outflows of $0.1 billion a year ago. In April-August, net FDI inflows increased to $13.8 billion from $9.6 billion in the corresponding period a year ago.

Net foreign portfolio investment (FPI) inflows rose to $1.7 billion in August, against net outflows of $2.6 billion a year ago. In April-August, net FPI outflows were up at $3.7 billion from $3.5 billion a year ago.

CURRENT ACCOUNT

The current account deficit (CAD) narrowed to $5.2 billion in August from $6.1 billion a year ago, the merchandise trade deficit moderated and the services trade surplus grew.

The goods trade deficit eased to $26.6 billion in August from $27.6 billion a year ago, while the services trade surplus rose to $16.5 billion during the reporting month from $15.6 billion a year ago.

Net transfers, which include remittances, rose to $12.8 billion in August from $12.2 billion a year ago.

The current account was in a deficit of $18.3 billion in the first five months of FY27, up from $12.8 billion a year ago.

The current account is likely to remain under some stress in the near term with crude oil prices staying above $100 per barrel, pushing India's merchandise trade deficit higher.

Data released by the commerce ministry of Thursday showed that India's merchandise trade deficit narrowed to $30.2 billion in September from $33 billion a year ago.