External Sector

Why it matters

• It determines the country's balance of payments position and foreign exchange reserves stability.
• It facilitates the integration of the domestic economy into global value chains and technology transfers.
• It serves as a primary transmission mechanism for global economic shocks and inflationary pressures.
• It influences domestic monetary policy and exchange rate management strategies.

How it is asked

Focus on the components of the Balance of Payments (Current Account and Capital Account), factors affecting exchange rate volatility, and the impact of trade policies on domestic industrial competitiveness.