Visible and Invisible Transactions of India


The transactions of a country can be broadly classified into two categories. Visible and Invisible transactions.

Invisible transactions 
These are transactions in services, transfers and income. Services are the most familiar of these categories, which includes software, management services, financial services etc. Transfers represent one-sided transactions, involving no quid pro quo, such as remittances by our compatriots abroad. Another category known as "income" is defined to include both payments and receipts — payments on account of non-residents employed in India, interest payments made to those who have deposited FCNR deposits and interest charges on loans made to India, besides dividends and profit share to investors in India. 

Visible transactions 
These are transactions in commodities, which are more visible and captured in data on foreign trade of goods.

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