India’s current account balance is expected to have turned positive in the January-March quarter, according to a Reuters poll. This would mark the first quarterly surplus in nearly two years for India, driven by a narrower trade deficit and an increase in services exports. The survey of 22 economists revealed that the current account balance likely recorded a surplus of $3.3 billion, or 0.4% of GDP, in the final quarter of the 2022/23 fiscal year. This is a significant improvement compared to the preceding quarter’s deficit of $18.2 billion, or 2.2% of GDP. Forecasts for the current account balance varied widely, ranging from a deficit of $5.0 billion to a surplus of $7.8 billion. Economists expect the merchandise trade deficit to narrow, primarily due to moderating global commodity prices. They also anticipate a steady balance in the invisibles trade, with services exports picking up. On the capital account front, foreign flows are expected to slow. Despite this, the overall balance of payments is predicted to remain largely steady, similar to previous quarters’ levels. The balance of payments is forecasted to show a surplus of $9.8 billion in the last quarter, compared to $11.1 billion in the preceding three months. Separate forecasts indicate that the current account deficit (CAD) is expected to average -1.5% of GDP this fiscal year and -1.8% next year, compared to -2.0% in the most recent fiscal year. Lower oil prices are likely to contribute to a shrinking trade deficit, leading to further narrowing of the CAD. Overall, the positive current account balance for India in the first quarter of 2022/23 reflects a positive trend for the country’s external sector.