India’s External Debt Rises 2.2 % in 2015-16

India’s External Debt Rises 2.2 % in 2015-16

With a rise in long term debt particularly NRI deposits, India’s external debt stock rose by 2.2 percent to USD 485.6 billion by end of last fiscal, an official report said.

According to “India’s External Debt: A Status Report 2015-16” prepared by the Department of Economic Affairs of Union Ministry of Finance, the external debt, in absolute term, rose by USD 10.6 billion by end of March 2016 over the same level previous year.

“At end-March 2016, long-term external debt was USD 402.2 billion, showing an increase of 3.3 percent over the level of 2015 (end-March). Long-term external debt accounted for 82.8 percent of total external debt at end-March 2016 as compared to 82 percent at end-March 2015,” a statement said.

The report said the short-term external debt declined by 2.5 percent from USD 84.7 billion at end-March 2015 to USD 83.4 billion at end-March 2016.

“This was mainly due to the decline in trade related credits. The share of short-term external debt in total external debt declined from 18 percent at end-March 2015 to 17.2 percent at end-March 2016,” it said.

Government (sovereign) external debt stood at USD 93.4 billion at end-March 2016 vis-a-vis USD 89.7 billion at end-March 2015.

The share of Government external debt in total external debt was 18.9 percent at end-March 2016 vis-a-vis 18.8 percent at end-March 2015.

According to a government note, India’s external debt has remained within manageable limits in 2015-16 as indicated by the increase in foreign exchange reserves to debt ratio to 74.2 percent, the external debt-GDP ratio of 23.7 percent, and fall in short term debt to 17.2 percent.