Balance of Payment (BoP), Types and Components Balance of Payment is a record of a country's economic transactions with the world. Read all about Balance of Payment and its Components in this article for UPSC. Balance Of Payment (BOP) is a statement that records all the monetary transactions made between residents of a country and the rest of the world during any given period. This statement includes all the transactions made by/to individuals, corporates and the government and helps in monitoring the flow of funds to develop the economy. When all the elements are correctly included in the BOP, it should be zero in a perfect scenario. This means the inflows and outflows of funds should balance out ... BALANCE OF PAYMENTS 4.1 Balance of Payments & Its Components : Balance of Payments (BoP) statistics systematically summaries the economic transactions of an economy with the rest of the World (i.e.transactions between resident & non resident entities) during a given period. It comprises of current and capital & financial accounts . It can be better appreciated in terms of the national income accounting identity: GDP = C+G+I+X-M. In other words, domestic output (GDP) is equal to private ... What is Balance of Payments (BoP)? Understanding the meaning of BoP: BoP summarises all transactions that a country’s individuals, companies, and government bodies complete (over a defined period) with individuals, companies, and government bodies outside the country.
