MoF: India’s external debt at $426 billion in December, 2013

As per the quarterly report of Ministry of Finance (MoF), India’s external debt was at $ 426 billion – including the government’s debt of $ 76.4 billion in December 2013. The total external debt of $ 426 billion showed an increase of $ 21.1 billion over the March-end level.

Reasons for increase of India’s external debt during the period were

  • Due to long-term debt particularly NRI deposits.
  • A sharp increase in NRI deposits reflected the impact of fresh FCNR(B) deposits mobilised under the swap scheme during September-November 2013.

 Excerpts of the quarterly report of Ministry of Finance (MoF) on December 2013 figures

  • Long term debt: $333.3 billion showed an increase of 8.1 % over March, 2013 level.
  • Short-term debt: Declined by 4.1 % to $92.7 billion.
  • Government (Sovereign) external debt:  $76.4 billion, (17.9 % of total external debt)
  • The share of US dollar denominated debt was the highest in external debt stock and stood at 63.6%, followed by debt denominated in Indian rupee (19.4 %), SDR (7.1 %), Japanese yen (5.0 %) and Euro (3.1 %).
  • The debt has remained within manageable limits as indicated by the external debt to GDP ratio of 23.3 %, vis-a-vis 21.8 % at end-March 2013 and debt service ratio of 5.9 % in 2012-13.
  • India’s foreign exchange reserves provided 69 % cover to the total external debt as of December end, against 72.1 % as of March-end 2013.
  • India’s external debt has remained within manageable limits due to prudent external debt management policy of the Government of India.

Note: The external debt management policy continues to focus on monitoring long and short-term debt, raising sovereign loans on concessional terms with longer maturities, regulating external commercial borrowings through end-use, all-in-cost and maturity restrictions, and rationalising interest rates on Non-Resident Indian deposits.

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