Growing trade imbalance would worsen current account deficit (CAD). Already, the rupee’s depreciation has raised fears of costlier imports while the country’s ability to take advantage of a weak currency to improve exports remains limited.
In terms of inflows, gross FDI (Foreign Direct Investment) into India increased to $61 billion in 2017-18 from $60.2 billion in 2016-17. However, net FDI inflows in 2017-18 fell to $30.3 billion from $35.6 billion in 2016-17.
Outgoing finance minister P Chidambaram had earlier said that current account deficit (CAD) was brought down significantly to $32 billion in 2013-14 against $88 billion during 2012-13 and fiscal deficit contained within the target during last fiscal.