India's external debt rose to $201.4 billion in 2007 news
31 March 2008

Mumbai: The country's external debt as of end-December 2007 stood at $201.4 billion (about Rs7,94,017 crore), up $10.3 billion from the previous quarter ended September 2007 and up $31.8 billion from the end-March 2007 level of $169.7 billion, the finance ministry said in a statement.

The increase was mainly due to a spurt in overseas commercial borrowing and short-term debt of corporates as also the appreciation of the rupee, the statement said.

Considering a total population of about 1,100 million, this works out to a per capita debt of Rs7,218, the statement said.

Valuation change, due to the depreciation of US dollar vis-a-vis major international currencies and the Indian rupees, accounted for $1.1 billion of the increase during the quarter and $6.0 billion during April-December 2007.

Long-term debt accounted for 82.6 per cent and short-term debt comprised 17.4 per cent of the outstanding external debt. Long-term debt rose by $6.3 billion to $166.2 billion and short-term debt by $4 billion to $35.2 billion over the quarter.

Amongst the components of long-term debt, commercial borrowing increased by $ 4.9 billion (9.4 per cent) to $57 billion.

NRI deposits declined by 1.5 per cent ($0.6 billion) to $43 billion while multilateral debt, bilateral debt and export credit rose marginally to $37.9 billion, $17.3 billion and $8.9 billion, respectively, as of end-December 2007.

Rupee debt continued to remain around the level of $2 billion. Under short-term debt, while trade related credits rose by around $4 billion, FII debt investment in government papers rose by $262 million over the quarter.

Based on residual maturity, long-term debt accounted for 64 per cent of total debt as at end-December 2007. Short-term debt by residual maturity, consisting of principal repayments due during a one-year reference period under medium and long-term loans, and short-term debt with original maturity of one year or less, accounted for 36 per cent of the total external debt, the statement said.

The share of government debt in total external debt stood at 26.3 per cent ($53 billion) and the share of non-government (private) debt was 73.7 per cent ($148.5 billion).

As of end-December 2007, India's foreign exchange reserves which include foreign currency assets of the Reserve Bank of India, gold, SDRs and reserve tranche position in the International Monetary Fund (IMF) stood at $275.3 billion, providing a cover of 137 per cent to total external debt, while the foreign currency assets of the RBI at $266.6 billion provided a cover of 132 per cent.

The share of US dollar in India's external debt portfolio has shown an increasing trend over the last few years. It further increased to 54.5 per cent at end-December 2007 from 52 per cent at end-March 2007.


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India's external debt rose to $201.4 billion in 2007