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Current Account

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What is current account?

Current account is among the two components of a country’s balance of payments, the other being the capital account.

It comprises of the balance of trade, net cash transfers and net factor income.

Current account, in India, is reported by the central bank i.e. the  Reserve Bank of India.

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Positive and negative current account balance  When a nation’s current account balance is

positive, it indicates that the nation is a net lender to the rest of the world.

A negative balance shows that the nation is a net

borrower from the rest of the world.  

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Current account deficit Current account deficit occurs when a nation’s

businesses and government import more goods and services than what they export.  

During the second quarter of 2014, India registered a current account deficit of $7.80 billion. 

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