International Trade

Step 1: Understanding India's current account surplus.
India experienced a surplus in its current account in the year 2020-21, mainly due to reduced imports during the COVID-19 pandemic and increased remittances. This was a rare event as India typically runs a current account deficit.

Step 2: Analysis of options.
- (A) 2018-19: India had a deficit in the current account in this year.
- (B) 2019-20: India had a deficit in the current account in this year.
- (C) 2020-21: This is correct. India had a surplus in its current account during this year.
- (D) 2021-22: India had a deficit in the current account in this year.

Step 3: Conclusion.
The correct answer is (C), as India had a surplus in its current account in the year 2020-21.

Step 1: Understanding the balance of payments accounts.
The balance of payments records all transactions between a country and the rest of the world. These transactions are categorized into different accounts: - The current account includes trade in goods and services, income from abroad, and current transfers. - The capital account includes capital transfers and the acquisition of non-produced, non-financial assets. - The official reserves account records the transactions in foreign exchange reserves held by the government. - The errors and omissions account adjusts for discrepancies in the balance of payments.

Step 2: Analysis of options.
- (A) Current account: This is correct. Expenditures on the maintenance of embassies and diplomatic missions are part of the current account, as they are services provided by the government.
- (B) Capital account: This is incorrect. The capital account deals with capital transfers and investment in non-financial assets, not service-related expenses.
- (C) Official Reserves Account: This is incorrect. The official reserves account deals with foreign exchange reserves, not current service expenses.
- (D) Errors and Omissions Account: This is incorrect. This account is used to correct discrepancies, not for recording regular expenditures.

Step 3: Conclusion.
The correct answer is (A), as expenditures related to the maintenance of embassies and diplomatic missions are recorded in the current account of the balance of payments.