India is likely to post its first current account surplus in nine years in the latest quarter, which should bolster the rupee though it is not a good sign for the economy as it reflects weak investment demand at home and subdued exports, analysts said.

Forecasts given by inv-estment houses’ research notes and from analysts showed expectations focu-sing on a surplus of $4 billion, or 0.8 per cent of GDP, in April-June quarter. That compared with a deficit of $6.2 billion, equivalent to 1.2 per cent of GDP, in the same quarter a year ago. And, if the forecasts prove correct it will be the first surplus since January-March 2007, though India is unlikely to keep the surpluses coming.

For the full year ending in March 2017, India is likely to post a deficit even lower than last year’s 1.1 per cent of GDP, as foreign investment inflows remain steady — and that should be broadly supportive for the rupee.

Analysts have revised down their forecasts for the 2016-17 deficit to below one per cent from earlier projections of between 1.2-1.5 per cent.

The Reserve Bank of India (RBI) is expected to release the June quarter data this month.

For a developing economy like India slow import growth is a negative sign, as it reflects weak investment because Indian firms need to buy capital goods and machinery from abroad.