Q. Which of the following will be included in the current account of India?
1.Exports from India to Japan
2.Remittances from workers in Saudi Arabia sent back to family members in India
3.Imports to India from China
Select the correct answer using the code given below:
Answer: D
Notes:
Exports are counted in the current account because they represent the movement of funds internationally, but do not represent a transaction that creates a future obligation. Exports create a current account credit.
Imports are counted in the current account because they represent the movement of funds internationally but do not represent a transaction that creates a future obligation. Imports create a current account debit.
Remittances are counted in the current account because they do not represent a transaction that has a future obligation tied to it. Remittances are simply a transfer of funds from one country to another that is not in exchange for anything.
Source- Article
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