External Debt on India: India’s external debt has increased in the last year. On Tuesday, the Reserve Bank of India (RBI) said that this figure had increased by $39.7 billion to $663.8 billion by the end of March 2024. However, despite this increase, the share of foreign debt in the country’s GDP has come down to 18.7 per cent. By the end of March 2023, this figure was around 19 percent.
US Dollar Is The Largest Component Of India’s Foreign Debt
According to RBI, the US dollar remains the largest component of India’s foreign debt, with a 53.8 per cent share at the end of March 2024. After this, the Indian rupee holds about 31.5 per cent, yen 5.8 per cent, SDR 5.4 per cent and euro about 2.8 per cent in foreign debt. The loan remains the largest component in foreign debt, with a 33.4 per cent share. After this, currency and deposits were 23.3 per cent, trade credit and advances 17.9 per cent and securities 17.3 per cent.
Valuation Effect Due To Increase In Value Of Dollar Was 8.7 Billion Dollars.
Reserve Bank said that if the valuation effect is removed, foreign debt will increase by 48.4 billion dollars instead of 39.7 billion dollars. In the valuation effect, the value of assets present abroad is seen. In addition, the value of domestic assets held by foreign investors is also assessed. RBI said in its statement that due to the weakness of the Rupee, Yen, Euro, and SDR against the US Dollar, the valuation effect was 8.7 billion dollars.
General Government Debt Increased By 11.5 Per Cent On An Annual Basis
RBI data shows that general government debt increased by 11.5 percent annually until March 2024. On the other hand, the debt of households and non-profit institutions declined by 16.5 percent. Reserve Bank data shows that the share of outstanding loans of non-financial corporations in total foreign debt was the highest, at 37.4 percent. The general government share in this was 22.4 percent.
