Net external claims on India marginally up at $362.3 bn at end-June

03 October 2015

Net claims of non-residents on India, as reflected by the net international investment position (IIP) increased by $0.6 billion over the previous quarter to $362.3 billion as of end-June 2015.

This change in the net position reflected in a $12.1 billion increase in the value of foreign-owned assets in India vis--vis a $11.4 billion increase in the value of Indian residents' financial assets abroad, Reserve Bank data showed.

Indian residents' financial assets abroad stood at $529.2 billion as of end-June 2015, showing an increase of $11.4 billion over the previous quarter, mainly due to a $14.4 billion increase in reserve assets and $1.3 billion in direct investment, whereas currency and deposits declined by $2.4 billion during the quarter, the RBI report stated.

Foreign-owned assets in India increased by $12.1 billion over the previous quarter to $891.5 billion, mainly due to the increase in direct and portfolio investments in India by $5.6 billion and $2.6 billion, respectively.

Among other investment liabilities, currency and deposits increased by $4.8 billion.

Variation in exchange rate of rupee vis-a-vis other currencies affected change in liabilities, when valued in $ terms.

Even as there was equity inflow of $9.7 billion (net) during April-June 2015, outstanding equity liabilities increased by $2.3 billion from $401.5 billion in March 2015 to $403.8 billion in June 2015, as outstanding liabilities were revalued due to rupee depreciation during the period.

The ratio of India's international financial assets to international financial liabilities stood at 59.4 per cent in June 2015 (58.9 per cent in March 2015).

Reserve assets continued to have the dominant share (67.3 per cent) in India's international financial assets in June 2015, followed by direct investment abroad (24.9 per cent).

Direct investment (30.3 per cent), portfolio investment (25.9 per cent), loans (19.6 per cent), and currency and deposits (13.5 per cent) were the major constituents of the country's financial liabilities.

The share of non-debt liabilities decreased marginally to 45.3 per cent as at end- June 2015 from 45.7 per cent at end- March 2015.

India's International Investment Position (IIP), June 2015

International Investment Position (IIP) is a statistical statement that shows, at a point in time, the value and the composition of financial assets of residents of an economy that are claims on non-residents, and gold bullion held as reserve assets; and liabilities of residents of an economy to non-residents.

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