Is India about to breach the 3% CAD red line?
- India’s current account deficit is nearing its de facto red mark of 3% of GDP. Is this the time to worry?
The two major forex crises most ordinary Indians would remember are the balance of payments crisis in 1991 and the one after the US Federal Reserve’s “taper tantrum" in 2013. Both events had one common feature: India’s current account deficit (CAD) breached 3% of GDP before they unfolded.