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Bloomberg
a day ago
- Business
- Bloomberg
India Posts Current Account Surplus as Trade Gap Narrows
India's current account returned a better than expected surplus in the January-March quarter as trade deficit narrowed following the revision of gold import data. The surplus in the broadest measure of trade in goods and services was $13.5 billion, or 1.3% of gross domestic product in the period, according to Reserve Bank of India data released Friday.
Skift
a day ago
- Business
- Skift
Travel is India's Biggest Global Spending Category: Here's How Much They Spent
India's monthly international travel spending is crossing $1 billion consistently. As Indian travelers prioritize experiences and loosen purse strings, destinations worldwide are racing to capture this high-value market. Indian travelers spent nearly $1.3 billion on international travel in April 2025. This is a 10% increase year-on-year and 13% higher than March, according to data from India's central bank Reserve Bank of India. Travel accounted for over 51% of the total international spending by Indians during April, while in March this was around 44%. The monthly international travel spending of Indians has consistently exceeded $1 billion, with it having reached $1.1 billion in February and $1.13 billion in March. In fiscal year 2024, Indians spent a record $31.7 billion abroad. International travel accounted for 54% of this spending amounting to $17 billion. In the 2025 fiscal year while total overseas spending dipped to $29.5 billion, travel spending remained steady at $16.9 billion, signaling a stabilized international travel spending pattern post-Covid. Notably, in August 2024, Indians spent over $2 billion on international travel, accounting for nearly 63% of that month's $3.2 billion in foreign spending. Who's Driving This Surge? India is becoming a fast-growing source of outbound tourism, according to a McKinsey report released last year. 'They are developing fast-growing pools of first-time tourists,' the report said. According to travel spending among Indians is expected to go up from $150 billion in 2019 to $410 billion by 2030. It added that while outbound trips accounted for 1% of the total trips in 2023, these trips contributed to 25% of the total expenditure. The online travel company expects this to increase to 35% by the end of the decade. Post-Covid, India's travel journey has been driven by its rising middle class, characterized by a young population with increasing spending power. According to Skift Research's 2025 Travel Outlook Survey, travelers from India and China are most likely to say they'll be on the move this year. India also has a significant lead over other destinations in terms of anticipated travel spending in 2025, it added. Experiences are a key part of this surge in travel. 'Once considered a luxury, travel has become a source of wellbeing and a way to gather unique experiences, which may constitute shopping, activities or even culinary experiences,' a recent report by consulting firm EY said. American Express India also made a similar observation. 'From shopping for local and handmade goods, making a special trip for a luxury purchase or attending concerts and sporting events, Indian travelers are prioritizing unique experiences in 2025,' it said. The report noted that the average length of stay among Indians increased by one day for domestic trips and two days for international trips in 2024 as compared to 2022. It further added, 'Indian traveler spending continues to grow with greater willingness to invest more in travel experiences. 80% of travel service providers have noticed increased travel budgets since 2022, with a quarter observing a rise of over 20%.' The most significant budget increase has been in international travel, followed by niche trips, EY said. Indians were spending on international trips approximately four times that of domestic travel, despite budget hotels being more popular among Indian tourists for their global adventures. EY also projected that the rise of short-haul destinations will lead to international travel growing at 18-20%. Destinations Bet on Indians The Indian traveler's growing appetite for international travel is making the country an increasingly attractive source market for global destinations. In 2024, India became the second-largest overseas market for the U.S., with 2.2 million Indian visitors. U.S. destination marketing organizations are prioritizing India, citing strong spending potential. 'There is big money,' Liz Bittner, president and CEO of Travel South USA told Skift. She noted that 290,000 Indians visited the southern U.S. in 2024, spending $450 million. In 2025, that figure is projected to rise to $507 million from 314,000 travelers, nearly 150% more than pre-Covid levels. Australia is also seeing a surge in Indian arrivals. In 2024, 443,000 Indians visited the country, a 12% year-on-year increase, their spending jumped 17%, Skift reported earlier this year. Nights spent by Indian travelers in Australia rose nearly 34%, reflecting deeper engagement. Tourism Australia credits a simplified visa process for this growth. 'The Australia visa these days is the easiest and simplest thing,' said Nishant Kashikar, country manager for India and the Gulf. 'No biometrics, no personal interviews, no physical document submission, including your passport. The entire process is digital.' Japan has also seen record-high Indian arrivals this year, supported by improved air connectivity. Across Southeast Asia, Indian tourism is booming as countries ease visa restrictions. According to travel platform Agoda, countries like Malaysia, Palau, the Philippines, and Sri Lanka — where visa processes have been simplified — have seen a clear uptick in interest. Agoda noted this trend by comparing accommodation searches between July–December 2024 for travel in January–May 2025 with the same period the previous year.
Bloomberg
a day ago
- Business
- Bloomberg
Indian Central Bank Drains $10 Billion to Lift Short-Term Rates
India's central bank drained 849.75 billion rupees ($10 billion) of excess cash from the banking system in its first such operation in seven months, aiming to lift overnight borrowing costs. The Reserve Bank of India withdrew funds via a 7-day variable rate reverse repo auction at a 5.49% cutoff yield on Friday, it said in a statement. The RBI had planned to soak up one trillion rupees.
Yahoo
a day ago
- Business
- Yahoo
India's economy to hold top spot for growth, but underlying weaknesses remain: Reuters poll
By Pranoy Krishna and Vivek Mishra BENGALURU (Reuters) -The Indian economy will grow at a mostly steady pace this fiscal year and next after marking a four-year low in 2024-25, according to economists polled by Reuters, who have mostly either kept their forecasts unchanged or made marginal upgrades. That stable outlook comes despite the Reserve Bank of India cutting interest rates by a full percentage point since early this year, including an unexpected 50 basis point reduction on June 6, to boost growth in the face of rising global uncertainties. But the world's fastest-growing major economy still earns that title mostly because government capital expenditure remains strong. Gross domestic product was forecast to expand 6.4% in the current fiscal year ending March 2026, the June 17-26 Reuters poll of 51 economists found. That is weaker than 6.5% reported for fiscal year 2024-25, which was the slowest since 2020-21. Growth was forecast to pick up modestly to 6.7% in FY 2026-27. That marks a slight upgrade from last month's poll, which had medians of 6.3% and 6.5%, respectively. "Most of the growth that was happening was mainly because of the capital expenditures of the government, which will flatten out," said Indranil Pan, chief economist at Yes Bank. Private sector spending is still trailing far behind, and analysts generally agree the economy is still failing to create enough quality jobs for its large young population. "One of the biggest challenges for India at the current juncture ... is per capita income. Job creation has not been strong enough to generate the income needed to support sustainable economic growth," Pan added. Some economists said there may be downgrades to the GDP outlook in the coming months if New Delhi fails to secure a trade agreement with Washington before the 90-day pause on tariffs comes to an end on July 9. Trade talks between the two sides have stalled over auto parts, steel and farm goods, Indian officials with direct knowledge told Reuters on Thursday, dashing hopes of a deal ahead of U.S. President Donald Trump's deadline to impose reciprocal tariffs. But ANZ economist Dhiraj Nim wrote they have upgraded their FY 2026 growth forecast on hopes that the two countries would reach a trade deal. "Even so, growth will remain below potential in a challenging global environment, warranting policy support," he added. The RBI shifted its policy stance to "neutral" from "accommodative" on June 6, signalling a likely end to its shallowest rate-cutting cycle in over a decade. But economists are divided on whether there would be a long pause or another 25-basis-point cut in the final three months of the year. Just over half of respondents - 28 of 53 - expected the repo rate to stay at 5.50% in the fourth quarter, while the rest forecast it at 5.25% or lower. Consumer inflation was expected to average 3.6% this fiscal year before rising to 4.3% next year, the poll showed. (Other stories from the June Reuters global economic poll) Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Reuters
a day ago
- Business
- Reuters
India's economy to hold top spot for growth, but underlying weaknesses remain
BENGALURU, June 27 (Reuters) - The Indian economy will grow at a mostly steady pace this fiscal year and next after marking a four-year low in 2024-25, according to economists polled by Reuters, who have mostly either kept their forecasts unchanged or made marginal upgrades. That stable outlook comes despite the Reserve Bank of India cutting interest rates by a full percentage point since early this year, including an unexpected 50 basis point reduction on June 6, to boost growth in the face of rising global uncertainties. But the world's fastest-growing major economy still earns that title mostly because government capital expenditure remains strong. Gross domestic product was forecast to expand 6.4% in the current fiscal year ending March 2026, the June 17-26 Reuters poll of 51 economists found. That is weaker than 6.5% reported for fiscal year 2024-25, which was the slowest since 2020-21. Growth was forecast to pick up modestly to 6.7% in FY 2026-27. That marks a slight upgrade from last month's poll, which had medians of 6.3% and 6.5%, respectively. "Most of the growth that was happening was mainly because of the capital expenditures of the government, which will flatten out," said Indranil Pan, chief economist at Yes Bank. Private sector spending is still trailing far behind, and analysts generally agree the economy is still failing to create enough quality jobs for its large young population. "One of the biggest challenges for India at the current juncture ... is per capita income. Job creation has not been strong enough to generate the income needed to support sustainable economic growth," Pan added. Some economists said there may be downgrades to the GDP outlook in the coming months if New Delhi fails to secure a trade agreement with Washington before the 90-day pause on tariffs comes to an end on July 9. Trade talks between the two sides have stalled over auto parts, steel and farm goods, Indian officials with direct knowledge told Reuters on Thursday, dashing hopes of a deal ahead of U.S. President Donald Trump's deadline to impose reciprocal tariffs. But ANZ economist Dhiraj Nim wrote they have upgraded their FY 2026 growth forecast on hopes that the two countries would reach a trade deal. "Even so, growth will remain below potential in a challenging global environment, warranting policy support," he added. The RBI shifted its policy stance to "neutral" from "accommodative" on June 6, signalling a likely end to its shallowest rate-cutting cycle in over a decade. But economists are divided on whether there would be a long pause or another 25-basis-point cut in the final three months of the year. Just over half of respondents - 28 of 53 - expected the repo rate to stay at 5.50% in the fourth quarter, while the rest forecast it at 5.25% or lower. Consumer inflation was expected to average 3.6% this fiscal year before rising to 4.3% next year, the poll showed. (Other stories from the June Reuters global economic poll)
