India recorded a current account surplus of $4.7 billion in April 2026, a sharp reversal from a deficit of $4.8 billion in the same month last year, according to preliminary data released by the Reserve Bank of India (RBI) on Monday, 15 June. The turnaround was driven by a surge in services exports and a significant jump in remittances, even as foreign portfolio investment outflows widened.

Services Exports and Remittances Drive the Surplus

Net services exports rose to $18.6 billion in April, up from $15.9 billion a year earlier. Gross services exports stood at $37 billion against imports of $18.4 billion, according to RBI data. Net transfers — largely comprising remittances from Indians working abroad — surged to $16 billion from $9.4 billion in April last year, marking one of the sharpest single-month jumps in recent memory. The net income deficit also narrowed to $1.9 billion from $3 billion in the year-ago period.

FDI Doubles, But FPI Outflows Widen

On the capital account, net foreign direct investment (FDI) climbed to $7.4 billion in April 2026 from just $1.6 billion a year earlier, with gross FDI inflows more than doubling to $11.4 billion from $5 billion. However, net foreign portfolio investment (FPI) recorded an outflow of $8.7 billion during the month — sharply higher than the $2.1 billion outflow seen in April last year. Banking capital also turned negative, registering a net outflow of $3.7 billion against a net inflow of $3.3 billion a year ago.

Context: Q4 FY26 and Full-Year Picture

The April surplus follows a current account surplus of $7.1 billion, or 0.7% of GDP, in the January–March quarter of 2025-26. In that quarter, the merchandise trade deficit widened to $83.4 billion from $59.3 billion a year earlier, even as net services receipts grew to $60.4 billion from $53.3 billion. For the full year 2025-26, net FDI inflows rose to $6.9 billion from $1 billion in 2024-25. FPI, however, recorded net outflows of $16.4 billion across the full year, compared with net inflows of $3.6 billion in 2024-25.

What the Data Signals

This comes amid a broader global environment of risk aversion, with emerging-market equities facing sustained FPI selling pressure. India's current account swing into surplus — despite widening portfolio outflows — underscores the growing weight of services exports and the diaspora remittance channel as structural buffers. Notably, India's services sector, led by IT and business process outsourcing, has continued to outperform even as global tech spending has come under pressure. The RBI is expected to factor the improving external account position into its assessment of rupee stability and monetary policy headroom in the months ahead.