In percentage terms, the Q3FY26 CAD increased to 1.3 per cent of GDP from 1.1 per cent of GDP in the year ago quarter
According to data released by the Reserve Bank of India (RBI) on March 2, 2026, India's Current Account Deficit (CAD) for the October–December quarter (Q3 FY26) widened to $13.2 billion, which is 1.3% of the GDP.
This is an increase compared to the same quarter in the previous year (Q3 FY25), when the deficit stood at $11.3 billion (1.1% of GDP).
Key Drivers of the Q3 2025 Deficit
The widening was primarily influenced by a larger trade gap, though strong "invisibles" helped cushion the impact:
Merchandise Trade Deficit: Widened significantly to $93.6 billion, up from $79.3 billion a year earlier. This was largely due to higher imports (specifically gold and silver) and dampened export growth, partially attributed to high U.S. trade tariffs during that period.
Services Receipts: Net services receipts grew to $57.5 billion (up from $51.2 billion), driven by strong exports in computer and business services.
Remittances: Private transfer receipts (remittances from Indians working abroad) rose to $36.9 billion.
Primary Income: The net outgo (investment income payments) actually decreased to $12.2 billion from $16.4 billion the previous year, which helped limit the overall deficit.
For the first nine months of the fiscal year (April–December 2025), the overall CAD actually moderated to $30.1 billion (1.0% of GDP) compared to $36.6 billion (1.3% of GDP) in the prior year, thanks to stronger performance in earlier quarters.
