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BALANCE OF PAYMENT.In INDIA
Balance of payments can be simply referred to as the money which flows into and out of the economy.
INDIA CHINA
EXPORTS
IMPORTS
MONEY COMES IN
MONEY GOES OUT
INFLOW OF MONEY ARE CREDITS
OUTFLOW OF MONEY ARE DEBITS
BUYING
PRODUCT COMES IN
SELLING
MONEY COMES IN
WE CAN EXPLAIN IT ON PERSONAL TERMS AS -
IF WE BUY SOMETHING THE PRODUCT COMES TO US BUT OUR MONEY GOES OUT THIS IS A DEBIT TO US.
IF WE SELL THE SAME PRODUCT TO SOME OTHER PERSON THE PRODUCT GOES OUT AND MONEY COMES IN THIS IS A CREDIT TO US.
DEBIT
CREDIT
BALANCE OF PAYMENT
….
THREE MAIN PARTS OF BOP
CURRENT ACCOUNTCAPITAL / FINANCIAL ACCOUNT
OFFICIAL RESERVES
CURRENT ACCOUNT NET EXPORTS - (OVERALL
EXPORTS OF GOODS AND SERVICES) IT COMPRISES OF 80-90% OF CURRENT ACCOUNT.
NET FOREIGN INCOME – IT INCLUDES ALL THE ASSETS OF THE COUNTRY AS WELL AS FOREIGN INVESTMENT AND EARNINGS FROM THE FOREIGN COMPANIES.
FOREIGN AID – IT INCLUDES THE MONEY WHICH A WORKER SENDS TO THEIR HOMELAND.
FINANCIAL ACCOUNT
REAL ASSETS - IT INCLUDES ALL THE TANGIBLE ASSETS OF THE COUNTRY
SUCH AS LAND BUILDING MACHINERY FACTORY ETC.
FINAANCIAL ASSETS – IT INCLUDES ASSETS SUCH AS STOCKS ,
BONDS SHARES ETC.
CURRENT ACCOUNT
FINANCIAL ACCOUNT
BUYING
PRODUCT COMES IN
CURRENT ACCOUNT INCLUDES OF ALL THOSE ASSETS WHO GO TO WHO BOUGHT THEM OR WHO NEEDE THEM.
MONEY GOES OUT
ASSET DOES NOT COME IN
FINANCIAL ACCOUNT INCLUDES THE ASSETS WHICH REMAIN ON THE SAME PLACE WHERE THEY WERE BOUGHT.
INDIA
FACTORY BOUGHTIN CHINA
HOPE YOU GUYS ENJOYED THE SESSION.
THIS WAS AN OVERVIEW OF BALANCE OF PAYMENT IN SHORT.
THANK YOU FOR YOUR
ATTENTION
credits
AAKASH SHARMANEHA BAGUL
ROSHAN KADAYATNIKITA YADAV
POONAM YADAVNEELU JAISWALSHIVAM TIWARI
MAGHA DEVENDRA