BoP Crisis in India
From 1947 till 1956-57, the India had a current account surplus. By the end of the first plan, the Trade deficit was Rs. 542 Crore and Net Invisibles was Rs. 500 Crore, thus giving a BoP deficit in Current Account worth Rs. 42 Crore. From this time onwards, the trade deficit increased from 3.8% of the GDP at market prices to 4.5% of GDP. Due to this, the government imposed the exchange controls. T…
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