New Delhi | Dec,3, 2025 — India’s Current Account Deficit (CAD) widened to 1.3% of GDP in the second quarter of FY26, largely driven by a sharp rise in gold imports, according to official data released on Friday. The increased demand for gold, fueled by festive buying and investment interest amid global uncertainty, significantly expanded the country’s import bill during the July–September period.
Despite the widening CAD, economists said the deficit remains within manageable levels due to strong services exports, steady remittances, and robust foreign capital inflows. Officials also maintained that India’s external sector remains resilient, backed by healthy forex reserves. However, experts cautioned that sustained high gold imports and volatile crude oil prices could put pressure on the external balance in the coming quarters.
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