Current Account Deficit

Finance Minister P Chidambaram with Finance Secretary RS Gujral Tribune photo: Mukesh Aggarwal Government has eased rules for FII( foreign Institutional Investors) by allowing them more liberal access to Indian corporate bond market from April 2013.Foreign investors can invest up to $25 billion in long-term government bonds, up from $15 billion.Cap on corporate bonds stays at $51 billion; separate limits on different types of corporate debt removed .These announcements are likely to promote inflow of portfolio investment and thereby facilitate infrastructure funding and bridge the current account deficit. Current Account Deficit  Occurs when a country's total imports of goods, services and transfers is greater than the country's total export of goods, services and transfers. This situation makes a country a net debtor to the rest of the world. www.colonelthakur-currentaffairs.blogspot.in