Goldman Sachs projected India’s current account deficit would widen to $37 billion in 2026, driven in part by higher non-oil imports as domestic demand strengthens.
The current account captures trade in goods and services plus transfer payments, with deficits indicating the country imports more than it exports in net terms. Goldman Sachs linked the expected expansion to increased purchases of capital goods, electronics, and other non-petroleum items.
While oil imports remain a traditional swing factor, the forecast emphasized non-oil categories reflecting consumption and investment recovery. A wider deficit can be financed through capital inflows but may pressure the currency if foreign investment falters.
The projection forms part of the bank’s broader India macro outlook, which also flagged GDP growth upside from trade and policy factors. Policymakers monitor deficit trends when calibrating exchange-rate and trade measures.
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Sources:
https://www.goldmansachs.com/insights/articles/the-outlook-for-indias-economy-in-2026-amid-new-us-tradedeal