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US Frowns Over India’s Forex Policies

India meets two of three criteria laid out for inclusion in the monitoring list. These are large trade surplus with US and excessive purchases of dollars. India’s bilateral merchandise trade surplus with US in 2017 at $23 billion was higher than the $20 billion benchmark used for assessment, and net purchases of foreign currency was 2.2% of gross domestic product (GDP), higher than the 2% cut-off. India did not meet the third criteria, which is having current account surplus of at least 3% of the GDP. India’s current account is in deficit.

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