This Presentation deals With:
What is a Current Account ,
Current Account Balance
Deficit In Current Account Balance.
Current Account Deficit In India,
Causes for Current Account Deficit,Impact Of Deficit,
India's Position.etc
2. Objectives
To Know about Current Account
Current Account Balance
Deficit or Surplus in Current Account Balance
Components of Current Account
Current Account Deficit in India
Causes Of Current Account Deficit
Impact Of Current Account Deficit
3. Current Account
Current Account is a part of balance of payments.
Current
account records transactions of
Goods,Services,Transfers,and Net income of a country with
the rest of the world.
4. Current Account Balance
It
is difference between the receipts and payments on account of
current account which includes trade balance. There can be either
surplus or deficit balance in current account.
A
Current account Deficit takes Place when the Debits
(Payments) are more than the Credit(receipts).
A Current Account Surplus Takes Place When the Credits are
More than the Debits.
5. Current Account Deficit
Current account deficit occurs when a country’s total
imports are greater than the country’s total exports. This
situation makes a country a net debtor to the rest of the
world.
Total Import
Total Export
Current Account deficit are Usually Measured as a
Percentage of GDP.
7. Current Account
1.Balance Of Trade (A)
It
is the difference between the monetary value of exports
and imports of goods in an economy over a certain period
of time.
BOT = Exports- Imports
8. Current Account
2.Earnings From Investment (B)
Foreigners invest their money in India through FDI and FII.
Similarly, Indian’s also invest their money abroad. The
investors earn an income in the form of Interest,Dividend.etc
9. Current Account
3.Cash Transfers (C)
Cash transfer is the money that is transferred without any
exchange of goods or services. One-sided Receipts/Payments.
Current Account =A+B+C
10.
11. Causes Of Current Account Deficit
in INDIA
High Consumption
Heavy Import Of Oil
Gold Imports
Low Exports
Decrease In FDI
Low Savings
Other non-essential imports
Natural Disasters/ Crisis
14. India’s Current Position
Economic
growth of India has slowed to 5 per cent(4.8 %)
in 2012-13 against 6.2 per cent in the previous fiscal.
Government has taken measures, such as to hike gold import
duty to 10%,increasing Export, increasing capital flow in
the country,
15.
Current Account deficit may not be always bad for an
economy, it may be good at the developing stages and bad
at the developed stage if it is in the long-run.