Document title: Developments in India's Balance of Payments for the Month of May 2026
Issuing authority: Reserve Bank of India (RBI)
Date: July 15, 2026
External Sector and Currency
The preliminary balance of payments for May 2026 shows the current account (net) at a deficit of $‑2.0 bn, a reversal from a $0.7 bn surplus in May 2025. Merchandise trade recorded a net deficit of $‑27.9 bn, with exports increasing to $46.1 bn and imports rising sharply to $74.0 bn. Services contributed a net surplus of $15.7 bn, driven by services exports of $33.4 bn against imports of $17.6 bn. Transfers posted a net inflow of $13.6 bn, while income remained negative at $‑3.4 bn.
Capital Markets and Flows
The capital account turned negative in May 2026, posting a net outflow of $‑2.4 bn compared with a $3.7 bn inflow in May 2025. Foreign Direct Investment (FDI) net was $‑0.1 bn, with $2.4 bn inflow in India and $2.4 bn outflow abroad. Foreign Portfolio Investment (FPI) saw a substantial net outflow of $‑4.7 bn, comprising a $‑4.5 bn outflow from India and a modest $0.3 bn outflow abroad. External commercial borrowings were almost flat at $0.1 bn net, with $2.1 bn inflow to India and $1.9 bn outflow by India. Short‑term credit to India turned positive at $3.2 bn net. Banking capital recorded a net outflow of $‑1.1 bn, while other capital posted a net outflow of $‑8.2 bn.
Overall Balance
Combining current and capital accounts, the overall balance for May 2026 is a deficit of $‑4.4 bn, a deterioration of $‑11.0 bn from the April‑May 2025 period. Corresponding monetary movements show a net increase of $4.4 bn, mirroring the overall balance swing.
The data indicate a marked shift from surplus to deficit across both current and capital accounts, driven primarily by a widening merchandise trade gap and significant FPI outflows.