This was a significant turnaround from the $4.8 billion deficit recorded in April last year.
The net transfer, which includes remittances, foreign aids and pension and gifts, stood at $16 billion in the first month of the fiscal, as compared with $9.4 billion in the year prior. The services sector also remained in surplus at $18.6 billion as compared with $15.9 billion in April last year.
The higher imports than exports meanwhile kept the net merchandise at a $27.9 billion deficit, against a $27.1 billion deficit earlier.
“It does appear that exporters have adjusted to the current global economic order and managed to hold on to their position three months into the war. Imports trended higher due to higher crude prices which thus kept the deficit higher,” Bank of Baroda chief economist Madan Sabnavis said.
India’s capital account also turned deficit at $11.3 billion in April as foreign portfolio investors (FPIs) withdrew $8.7 billion from Indian markets in a risk-off strategy amid the geopolitical conflicts. The FPIs had withdrawn $2.1 billion in the same month last year when the capital account was in a $5.3-billion surplus.
Foreign direct investment (FDI), meanwhile, rose to a net $7.4 billion as compared with $1.6 billion a year prior.