India’s Current Account Deficit (CAD) has seen a significant jump to account for 2.9% of the country’s Gross Domestic Product (GDP) in the Q2, marking an end period in September. This rise in CAD comes in stark comparison to the 1.1% that was recorded in the same period a year ago.
Reasons for Rising CAD
The primary factors credited for this sharp increase in CAD include a substantial spike in oil prices and a weakening rupee, making imports more expensive. However, as both these situations have seen some relief recently, the expectation is that the CAD will start to decrease later in the year.
Understanding Current Account Deficit (CAD)
The CAD is mainly the difference between the inflow and outflow of foreign exchange. Essentially, it signifies that the imports of goods, services, and investment incomes into the economy have exceeded the value of its exports.
Fiscal Deficit and Its Connection with CAD
The Fiscal Deficit, also known as the “budget deficit,” occurs when a nation’s expenditure surpasses its revenues. Interestingly, the Fiscal Deficit and CAD, known collectively as ‘twin deficits,’ often reinforce each other. Basically, when there is a high fiscal deficit, it typically leads to a higher CAD and vice versa.
| Facts | Details |
|---|---|
| CAD in the last years’ same period | 1.1% |
| CAD this year in Q2 | 2.9% |
| Main reasons for increased CAD | Rise in oil prices, Weakening rupee |
| Expected CAD situation in later this year | Projected to decrease |
NITI Aayog and Perlin’s ‘AI 4 All Global Hackathon’
In a significant move towards positive social and economic impacts for India, NITI Aayog, in partnership with a Singapore-based startup in Artificial Intelligence (AI), Perlin, has launched the ‘AI 4 All Global Hackathon’. This Hackathon encourages developers, students, startups, and companies to come up with AI applications that will have far-reaching implications for society and the economy.
Continuing with its vision to expand the concept of ‘Artificial Intelligence, AI for All’ as per the National AI Strategy, NITI Aayog is organising hackathons to source innovative, sustainable, and technologically enabled solutions to tackle various development challenges. It’s worth mentioning that it had also organised ‘MoveHack’, on the sidelines of the Global Mobility Summit 2018.
