India's external debt lowers to USD 479 bn at end-June

Mumbai, Sep 30: India's external debt declined 1.1 per cent to USD 479.7 billion at end-June 2016 over the previous quarter, primarily on account of a decline in commercial borrowings.

"At end-June 2016, India's external debt was placed at USD 479.7 billion, recording a decline of USD 5.4 billion over its level at end-March 2016," a RBI data released today said.

The decline in the magnitude of external debt was partly offset by valuation gains resulting from the appreciation of the US dollar vis-a-vis the rupee and other major currencies.

The external debt to GDP ratio stood at 23.4 per cent as at end-June 2016, a shade lower than its level of 23.7 per cent at end-March 2016.

"Valuation gains due to appreciation of the US dollar against the Indian rupee and other major currencies was placed at USD 1.4 billion. Excluding the valuation effect, the decline in external debt would have been USD 4 billion instead of USD 5.4 billion as at end-June 2016 over the level at end-March 2016," the central bank said.

 Commercial borrowings continued to be the largest component of external debt with a share of 36.6 per cent, followed by NRI deposits (26.3 per cent) and short-term trade credit (16.6 per cent).

 At end-June 2016, long-term debt was placed at USD 397.6 billion, recording a decline of USD 4.1 billion over its level at end-March 2016. The share of long-term debt in total external debt was marginally higher at 82.9 per cent as at end-June 2016 as compared to its level at end-March 2016.

US dollar denominated debt continued to be the largest component of India's external debt with a share of 57.1 per cent as at end-June 2016, followed by the Indian rupee (28.6 per cent), SDR (5.9 per cent), Japanese yen (4.8 per cent) and Euro (2.4 per cent).

The share of short-term debt (original maturity) in total debt witnessed a marginal decline over its level at end-March 2016.

The ratio of short-term debt (original maturity) to foreign exchange reserves declined to 22.6 per cent as at end-June 2016 (23.1 per cent at end-March 2016).

India's external debt statistics for the quarters ending March and June are released by the Reserve Bank with a lag of one quarter and those for the quarters ending September and December by the Ministry of Finance.

PTI