The external current account deficit (CAD) remains our biggest worry today. We closed 2012-13 with a CAD at 4.8% of GDP. That was much too large an asking number for capital account inflows to keep the rupee on an even keel. Gold imports alone stood at $54 billion, a whopping 61% of the overall current deficit.

Without gold imports, our CAD in 2012-13 would have been a little under 2% of GDP, a well-behaved and totally tractable level. So our external problem reduces to the gold problem. Read More

Jyothi Shankaran

    Jyothi’s last role was as Senior Editor with the business news channel Bloomberg TV India. He also worked as News Editor at business-standard.com, the online version of the business newspaper Business Standard. Jyothi is a chemical engineer from the Regional Engineering College, Srinagar.