Our Bureau

New Delhi , Feb. 25

THE outlook for balance of payments appeared to be "reasonably strong" and "resilient" despite the volatility in crude oil prices and any acceleration in imports resulting from positive macroeconomic scenario, the Economic Survey has said.

It has highlighted that India would have a current account deficit in 2004-05, after three consecutive years of surplus.

Stating that the external sector is likely to benefit from the sustained momentum of manufacturing activity, the survey noted that the continued robust growth of exports of merchandise and services was likely to absorb additional imports.

It also held that overall capital flows is expected to remain buoyant given the positive economic outlook. It highlighted that the country's external sector was expected to remain a source of strength, providing comfort to the conduct of macro-economic policies, despite the major uncertainties in the international environment such as hardening of interest rates, volatility of crude oil prices and uncertain prospects of soft-landing of China's economy.

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