Balance of Payments:
India has emerged as the world’s fastest-growing major economy, recording an average annual GDP growth of 8.2% from 2021 to 2024, outpacing countries like Vietnam, China, and the United States. Despite strong growth, India faces low net foreign capital inflows, reflecting a gap between GDP expansion and investor sentiment in its Balance of Payments.The BoP serves as a crucial economic indicator, detailing all financial transactions between India and the rest of the world. This comprehensive ledger tracks the inflow and outflow of money where inflows are marked positive and outflows negative, reflecting the country’s economic interactions globally. It measures the relative demand for the rupee against foreign currencies, crucially influencing exchange rates and economic stability.
