Abstract: The BOP&BOT position is essential measure for the sound health of an economy and can be studied under the major heads of export, import, current account, capital account and international reserves. Most of the developing countries are in BOP&BOT deficit and India is being no exception for this. Since, independence, Indian economy has been facing deficit or disequilibrium in terms of BOP&BOT, largely observed as a disaster in 1991, the year of the severe BOP crisis and economic reforms. Different economic activities conducted by the country with different nations in the world affect India’s BOP&BOT in some or the other way. While studying Indian economy balance of payments and balance of trades is very important as BOP&BOT have impact on economic health of the country and companies. Trade policies of government, political and cultural relations with different nations, exchange rate policies, convertibility policies, economic planning and policies etc. influence international commercial activities and affect the BOP&BOT of India.