India achieved a positive growth in the current account of the balance of payments in the year 2002-03. Which of the following can be considered a possible explanation for this?

Explanation

For the given question, option (d) is the correct answer. The faster growth of merchandise imports compared to merchandise exports widened the merchandise trade deficit; however, the surplus from services helped cushion the overall trade deficit. Strong services exports helped India secure the seventh-largest share in global services exports. In addition, the net receipts under private transfers increased due to remittances received from abroad. These factors ensured that India’s current account deficit (CAD) remained relatively contained at 1.2% of GDP in the second quarter of FY 2024–25.