Question:medium

Identify which of the following will appear on the debit side in the Capital Account of India’s Balance of Payments:

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Capital account debit entries indicate outflows of funds, such as investments abroad or repayment of loans.
Updated On: Jan 13, 2026
  • An Indian sending remittances from England
  • Investing in assets abroad by Indians
  • An American company purchasing shares of an Indian company
  • Export of spices from India
Show Solution

The Correct Option is B

Solution and Explanation

A debit entry in the Balance of Payments (BoP) Capital Account signifies an outflow of funds.
Option (B): Indian investments in foreign assets result in capital flowing out of India, which is recorded as a debit.
Options (A), (C), and (D): These options pertain to current account transactions or represent capital inflows, which are recorded as credit entries.

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