India at high risk of BoP 'shock': Morgan Stanley

India faces a "high" risk of a shock in its balance of payments, unless the government cuts spending, including on subsidies, or oil prices decline sharply, Morgan Stanley warns.

India faces a "high" risk of a shock in its balance of payments, unless the government cuts spending, including on subsidies, or oil prices decline sharply, Morgan Stanley warns.

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India is the only country in the region with a current account deficit, and a wide one at that, given expectations it hit a record high for the year ended in March.

Given the vulnerability on so many domestic fronts, any signs of global risk aversion would particularly hit flows and the rupee, Morgan Stanley adds.