Reserve Bank of India Governor Sanjay Malhotra has stated that India's external sector has strengthened considerably over the last decade. The current account deficit (CAD) has remained well within the sustainable limit in recent years - it was 0.6 per cent of GDP in 2024-25. This is due to robust services exports and strong remittance receipts despite higher merchandise trade deficit. Capital flows have generally exceeded the CAD, adding to our foreign exchange reserves which stood at 695 billion USD as on August 15, 2025, providing merchandise imports cover of over 11 months.

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