Professional Documents
Culture Documents
OF INDIA
Presented by-
RANJIT SHETTY 31
MAMTA BIST 04
WHAT IS BOP ?
The balance of payments accounts are those
that record all transactions between the
residents of a country and residents of all
foreign nations.
The BOP is determined by the country's
exports and imports of goods, services, and
financial capital, as well as financial
transfers.
It reflects all payments and liabilities to
foreigners (debits) and all payments and
obligations received from foreigners (credits).
Balance of payments is one of the major
indicators of a country's status in
BOP CONSISTS OF
The Current Account
3. Income Account
(The income account accounts mostly for
investment income from dividends and
interest on credit and payments on foreign
taxes.)
5. Transfer payment
(Grants received / given, Pvt.Transfer)
CAPITAL ACCOUNT
1. Foreign Investment(FDI, FII)
2. Banking Capital (NRI Deposits)
3. Short term credit
4. External Commercial Borrowings(ECB)
CAPITAL ACCOUNT
If foreign ownership of domestic financial
assets has increased more quickly than
domestic ownership of foreign assets in a
given year, then the domestic country has a
capital account surplus.
On the other hand, if domestic ownership of
foreign financial assets has increased more
quickly than foreign ownership of domestic
assets, then the domestic country has a
capital account deficit.
OFFICIAL INTERNATIONAL RESERVES
The official international reserve account
records the change in stock of official
international reserve assets (also known
as foreign exchange reserves) at the
country's monetary authority .
Decline in exports
1.1% drop to $ 12.7 billon in Dec 08
12.1% drop in Oct 08
9.9% drop in Nov 08
Subprime crisis
IS INDIA HEADING TOWARDS BOP
CRISIS OR NOT ?
What is BoP crisis
Sufficient Forex Reserves
Volatility of FII
FACTORS IMPACTING BOP
Trade Agreement
Trade Policy
Exemption of Tax
MEASURES FOR MAKING BOP
FAVOURABLE
Diversification of Trade
Development of New Industries