Trade Sector Updates – Falling Exports, TIES, MEIS, Foreign Trade Policy, etc.

What is Balance of Payments?

Note4Students

From UPSC perspective, the following things are important :

Prelims level : BoP, BoT, Current Account

Mains level : BoP Crisis

India’s balance of payments this year is going to be “very very strong” on the back of significant improvement in exports and a fall in imports said the Commerce and Industry Ministry.

Try this PYQ:

Q.In the context of India, which of the following factors is/are contributor/contributors to reducing the risk of a currency crisis? (CSP 2019)

  1. The foreign currency earnings of India’s IT sector
  2. Increasing the government expenditure
  3. Remittances from Indians abroad

Select the correct answer using the code given below.

(a) 1 only

(b) 1 and 3 only

(c) 2 only

(d) 1, 2 and 3

Balance of Payment

  • BOP is the oldest and the most important statistical statement for any country.
  • In a nutshell BOP of a country is “a systematic record of all economic transactions between the residents of one country with the residents of the other country in a financial year”.
  • Economic Transactions include all the foreign receipts and payments made by a country during a given financial year.
  • Foreign receipts include all the earnings and borrowings by a country from the other countries.

Read the complete thread, here, at:

India’s Balance of Payments: Current Account, Capital Account, Goods and Services Account

Subscribe
Notify of
0 Comments
Inline Feedbacks
View all comments