Overseas claims on India up $44.3 bn at $431.7 bn in December 2018
01 April 2019
Net claims of non-residents on India at the end of December 2018 increased by $44.3 billion from their level a quarter ago, on the back of a pick-up in foreign-owned assets in India after three consecutive quarters of contraction, combined with a marginal decline in Indian residents’ financial assets abroad.
Non-resident claims on India stood at $431.7 billion at the end of December 2018 against $387.4 billion at the end of September 2018, RBI figures showed.
Foreign-owned assets in India, on the other hand, increased from $995.4 billion at the end of September 2018 to $1,035.5 at the end of December 2018.
The large increase in foreign-owned assets in India emanated from inward foreign direct investment (FDI), followed by portfolio investment and currency and deposits, according to RBI data.
Overseas financial assets of Indian residents, on the other hand, declined during the quarter, mainly due to reduction in reserve assets, even as overseas direct investment increased during the period.
Appreciation of the Indian rupee against the US dollar during the quarter contributed substantially to the increase in net claims of non-residents valued in US dollar terms.
Despite a decline during the quarter, reserve assets accounted for nearly two-thirds of India’s international financial assets.
The share of debt liabilities in total liabilities declined marginally during the quarter.
Asset to liability ratio of Indian owned assets overseas to foreign-owned assets in India declined from 61.1 per cent at the end of September 2019 to 58.3 per cent at the end of December 2019.