With expectations of a significant rise in savings rate and share of working population over next 50 years in India, the current phenomenon of overall surplus in balance of payments may not be a temporary one, Reserve Bank of India deputy governor Rakesh Mohan said on Friday.
"India is entering the second stage of demographic transition and over the next half-century, a significant increase in both saving rates and share of working age population is expected. The share of the labour force in population is expected to overtake the rest of Asia, including China, by 2030", Mohan said, delivering a lecture in Colombo on 'Challenges to monetary policy in a global context.'
In this scenario, current phenomenon of overall surpluses in BoP being run by several emerging market economies, including India, may not be a temporary one, he said, adding, the largest reserve holding countries (excluding gold) in the world were emerging market economies.
RBI in September had said that the current account in April-June 2003, with a trade deficit of $5.9 billion and a net invisible surplus of $4.7 billion, registered a deficit of $1.2 billion.
This shift in the current account position was witnessed after maintaining surplus position for six consecutive quarters since the third quarter of fiscal 2001-02. During this period, quarterly current account surplus ranged between $0.4 billion and $1.9 billion, it had said.
