India’s external debt rose 12.4% in March

India’s external debt increased 12.4 per cent in March 2018 over a year ago, on account of an increase in commercial borrowings, short-term debt and nonresident Indian deposits. At end-March, India’s external debt was $529.7 billion.

India's external debt increased 12.4 per cent in March 2018 from a year-ago figures, primarily on account of an increase in commercial borrowings, short-term debt, and deposits from non-resident Indians (NRIs).

At the end of March 2018, India's external debt was at $529.7 billion, recording an increase of $58.4 billion over its level at the end of March 2017, the RBI said in a notification.

The external debt level, however, suffered from valuation loss after the US dollar depreciated against major currencies that time. The dollar has started strengthening now. Excluding the valuation effect, the increase in external debt would have been $53.1 billion. The external debt to GDP ratio stood at 20.5 per cent at the end of March this year, higher than its level of 20.0 per cent in the same period last year.

The share of long-term debt (over one year) in total external debt at end-March 2018 was 80.7 per cent, lower than its level of 81.3 per cent at end-March 2017.

The share of short-term debt in total external debt increased to 19.3 per cent at end-March 2018 from 18.7 per cent at end-March 2017.

"The ratio of short-term debt to foreign exchange reserves increased to 24.1 per cent at end-March 2018 (23.8 per cent at end-March 2017)," the RBI said.

Excluding the valuation effect, the increase in external debt would have been $53.1 billion