RBI expects to be under 3 per cent of GDP in FY23

The Reserve Bank expects to be under 3 per cent in FY23, Deputy Governor Michael Patra said on Friday.

The CAD will narrow in the second half and widen in the first half of the fiscal year, Patra told reporters at the customary post-policy press conference.

We expect the to be under 3 per cent of the FY 23 budget, according to Patra.

The data released by the RBI showed that the CAD widened in the first quarter of the fiscal to 2.8 per cent of GDP in FY22, the CAD had stood at 1.2 per cent of GDP.

Patra pointed out that certain factors helped the CAD recently, and that there are factors beyond the widening trade deficit as the exports are getting hit due to the adverse economic developments in the advanced economies.

He said that the oil prices have moved south, which will lower the import bill, and there has been a 23 per cent growth in petroleum exports, due to the slashing of windfall taxes by the government.

He said services exports are doing very well and there is a boost coming from the travel segment as tourism has picked up in a big way.