The surge in crude oil prices on the back of top Iranian killed by US airstrike poses a threat to India’s current account deficit (CAD), said Singapore-based DBS in a note. However, Indian experts are of the view that impact on current account deficit is unlikely to be a challenge for now. There would be some pressure on CAD if the price surge persists for a longer duration.
“We are hugely dependent on crude and gold imports and both commodities have recently gone up due to the geopolitical issues in the middle east. There is a risk that if the prices continue to stay at a higher level, there would be pressure on CAD. Meanwhile, the rupee has also depreciated,” Siddhartha Khemka, VP – Head of Research at Motilal Oswal Financial Services, told Financial Express Online.
