Developments in India’s Balance of Payments for the Month of August 2026

The preliminary balance of payments report for India in August 2026 has been released, showing a significant improvement compared to the previous month. The current account deficit narrowed from a deficit of $6.1 billion in August 2025 to $5.2 billion in August 2026. The merchandise trade balance, which is the largest component of the current account, also improved, with exports increasing from $35.1 billion to $44.7 billion, while imports rose from $62.7 billion to $71.3 billion.

Services trade also increased, with exports growing from $15.6 billion to $16.5 billion, and imports rising from $15.6 billion to $18.9 billion. Net income from investments and other services-related activities increased by $12.2 billion in August 2026 compared to the previous month. The overall balance of payments improved from a deficit of $5.6 billion in August 2025 to a surplus of $45.4 billion in August 2026.

The capital account also saw significant changes, with foreign direct investments (FDIs) increasing from a deficit of $0.1 billion in April-August 2025 to $3.3 billion in the same period of 2026. Foreign portfolio investments also showed an improvement, with a net increase of $1.7 billion in 2026. However, external commercial borrowings (ECBs) saw a large decrease, from a deficit of $0.1 billion in the previous period to a deficit of $22.4 billion in August 2026.

Despite this, the net increase in the balance of payments for the four-month period from April to August 2026 was $58 billion, marking a substantial positive trend in India's economic health.