India has reported a record current account surplus of almost $20 billion between April and June this year. This is yet another evidence of a contracting economy since the surplus comes as a function of imports seeing a sharper plunge during this period, compared to the fall in exports. Remember, India spent a major portion of this quarter locked-down.

At $19.8 billion, the current account surplus is 3.9 percent of India’s GDP and much higher than the $600 million surpluses reported in the fourth quarter of last year. The record surplus is in sharp contrast to the $15 billion deficit that was reported in the same period last year.

Economists believe India could end up with a current account surplus for the full year, which will mean a year of pain where the economy is concerned. However, they say the surplus number could shrink as the year progresses. They also take heart from the fact that services and remittances data have largely remained steady in the first quarter.

More worrying signs for the economy, growth is still not on the mend and India's 8 core sectors continue to struggle. Growth in August contracted by 8.5 percent. This is worse than the 8 percent contraction in July. In fact, the data in July offered some hope of a rebound after the 38 percent contraction in April and the 21 percent contraction in May. But, the August data shows that green shoots are still elusive. Also, the government keeps the borrowing calendar unchanged and keeps FY21 borrowing at Rs 12 lakh crore as of now.

To discuss this issue, Ananth Narayan, professor at SPJIMR; Upasna Bhardwaj of Kotak Mahindra Bank; Madan Sabnavis, chief economist at Care Ratings and Mahendra Jajoo, head-fixed income at Mirae MF are in conversation with CNBC-TV18.