New Delhi, Sep 15 (IANS) India’s external debt stood reduced by 2.7 per cent at $471.9 billion by March-end as compared to March 2016 due to reduced commercial borrowings and NRI deposits, a Finance Ministry report said on Friday.
“India’s external debt stock stood at $471.9 billion at end-March 2017, decreasing by $13.1 billion (2.7 per cent) over $485 billion at end-March 2016. The decline in external debt was due to the decrease in long-term debt particularly NRI deposits and commercial borrowings,” according to the India’s External Debt: A Status Report 2016-17.
The report is the 23rd issue of the annual publication, which is a detailed analysis of India’s external debt position at end-March 2017, based on the data released by the Reserve Bank of India on June 30 and data and information available from other sources.
Apart from analysing the trend, composition and debt service of India’s external debt, the report provides a comparative picture of India’s external debt vis-a-vis other countries, particularly developing countries.
“India’s external debt has remained within manageable limits and the external debt situation has improved in 2016-17 over 2015-16 as indicated by the increase in foreign exchange reserves cover to debt to 78.4 per cent from 74.3 per cent and fall in the external debt-GDP ratio to 20.2 per cent from 23.5 per cent. External debt of the country continues to be dominated by the long-term borrowings,” the report noted.
It also said that by March-end, India’s long-term external debt was at $383.9 billion, showing a decrease of 4.4 per cent over the level at end-March 2016. Long-term external debt accounted for 81.4 per cent of total external debt at end-March 2017 as compared to 82.8 per cent at end-March 2016.
“Short-term external debt increased by 5.5 per cent to $88.0 billion at end-March 2017. This is mainly due to the increase in trade related credits, a major component of short-term debt with a share of 98.3 per cent.
“Government (sovereign) external debt increased from $93.4 billion at end-March 2016 to $95.8 billion at end-March 2017, and constituted 20.3 per cent of the total external debt, as compared to 19.3 per cent in the previous year,” it added.
A cross country comparison based on ‘International Debt Statistics 2017’ of the World Bank which presents the debt data for 2015, shows that India continues to be among the less vulnerable countries with its external debt indicators comparing well with other indebted developing countries.
The ratio of India’s external debt stock to gross national income at 23.4 per cent was the fifth lowest and in terms of the cover provided by foreig