As per the standard practice, India's external debt statistics for the quarters ending March and June are released by the Reserve Bank of India with a lag of one quarter and those for the quarters ending September and December by the Ministry of Finance, Government of India. The external debt data as at end-March 2016 in rupees and US dollars as well as revised data for the earlier quarters are set out in Statements 1 and 2, respectively. The major developments relating to India’s external debt as at end-March 2016 are presented below. Highlights India’s external debt at end-March 2016 witnessed an increase of 2.2 per cent over its level at end-March 2015, primarily on account of a rise in outstanding NRI deposits. Furthermore, the increase in the magnitude of external debt was partly offset by valuation gain resulting from the appreciation of the US dollar vis-a-vis the Indian rupee and other major currencies. The external debt to GDP ratio stood at 23.7 per cent at end-March 2016, a shade lower than its level of 23.8 per cent at end-March 2015. Major highlights pertaining to India’s external debt as at end-March 2016 are presented below: -
India’s external debt at end-March 2016 was placed at US$ 485.6 billion, recording an increase of US$ 10.6 billion over its level at end-March 2015 (Table 1). -
Valuation gain, due to appreciation of the US dollar against the Indian rupee and other major currencies, was placed at US$ 5.9 billion. Excluding the valuation effect, the increase in external debt would have been higher by US$ 16.4 billion at end-March 2016 over the level at end-March 2015. -
Commercial borrowings continued to be the largest component of external debt with a share of 37.3 per cent, followed by NRI deposits (26.1 per cent) and short-term trade credit (16.5 per cent). -
The share of short-term debt (original maturity) in total debt witnessed a decline over the corresponding quarter of the previous year. Similarly, the ratio of short-term debt (original maturity) to foreign exchange reserves declined to 23.1 per cent as at end-March 2016 (25.0 per cent as at end-March 2015). -
On residual maturity basis, short-term debt constituted about 42.6 per cent of total external debt at end-March 2016 (38.2 per cent at end-March 2015) and stood at 57.4 per cent of total foreign exchange reserves (53.2 per cent at end-March 2015) (Table 2). The rise in short-term debt (residual maturity) mainly reflects payments due on account of maturing of FCNR(B) deposits mobilised under the special swap scheme in 2013. -
US dollar denominated debt continued to be the largest component of India’s external debt with a share of 57.1 per cent at end-March 2016, followed by Indian rupee (28.9 per cent), SDR (5.8 per cent), Japanese Yen (4.4 per cent) and Euro (2.5 per cent). -
Across borrower categories, the outstanding debt of Government as well as non-Government debt increased and their shares in total external debt were 19.2 per cent and 80.8 per cent, respectively, at end-March 2016 (Table 3). -
Debt service payments increased to 8.8 per cent of current receipts at end-March 2016 as compared to 7.6 per cent at end-March 2015 (Table 4). Table 1: External Debt - Outstanding and Variation | (US$ billion) | Component | Outstanding as at end-March | Absolute variation | Percentage variation | 2014 | 2015 R | 2016 P | Mar-15 over Mar-14 | Mar-16 over Mar-15 | Mar-15 over Mar-14 | Mar-16 over Mar-15 | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 1. Multilateral | 53.4 | 52.4 | 54.0 | -1.0 | 1.6 | -1.9 | 3.0 | 2. Bilateral | 24.7 | 21.8 | 22.5 | -3.0 | 0.8 | -12.0 | 3.5 | 3. IMF | 6.1 | 5.5 | 5.6 | -0.7 | 0.1 | -10.8 | 2.1 | 4. Trade Credit | 15.5 | 12.6 | 10.7 | -2.9 | -2.0 | -18.7 | -15.5 | 5.Commercial Borrowings | 149.4 | 180.6 | 181.3 | 31.3 | 0.7 | 20.9 | 0.4 | 6. NRI Deposits | 103.8 | 115.2 | 126.9 | 11.3 | 11.8 | 10.9 | 10.2 | 7. Rupee Debt | 1.5 | 1.5 | 1.3 | 0.0 | -0.2 | 2.6 | -15.1 | 8. Short term Debt | 91.7 | 85.5 | 83.4 | -6.2 | -2.1 | -6.7 | -2.5 | Of which | Short term trade credit | 81.7 | 81.6 | 80.0 | -0.1 | -1.6 | -0.1 | -2.0 | Total Debt | 446.2 | 475.0 | 485.6 | 28.9 | 10.6 | 6.5 | 2.2 | Memo Items | A. Long-Term Debt | 354.5 | 389.5 | 402.2 | 35.0 | 12.7 | 9.9 | 3.3 | B. Short-Term Debt | 91.7 | 85.5 | 83.4 | -6.2 | -2.1 | -6.7 | -2.5 | P: Provisional. R: Revised | Table 2: Residual Maturity of External Debt Outstanding as at End-March 2016 | (US$ billion) | Component | Short-term up to one year | Long-term | Total (2 to 5) | 1 to 2 years | 2 to 3 years | More than 3 years | 1 | 2 | 3 | 4 | 5 | 6 | 1. Sovereign Debt (long-term) $ | 4.3 | 5.6 | 5.9 | 77.5 | 93.3 | 2. Commercial Borrowings # | 28.8 | 19.6 | 22.2 | 111.4 | 182.0 | 3. NRI deposits {(i)+(ii)+(iii)} | 90.4 | 13.3 | 11.5 | 11.8 | 126.9 | (i) FCNR(B) | 33.9 | 2.2 | 5.9 | 3.4 | 45.3 | (ii) NR(E)RA | 48.0 | 10.2 | 5.3 | 7.9 | 71.5 | (iii) NRO | 8.5 | 0.9 | 0.3 | 0.5 | 10.1 | 4. Short-term Debt* (Original maturity) | 83.4 | | | | 83.4 | Total (1 to 4) | 206.9 | 38.5 | 39.6 | 200.6 | 485.6 | Memo Items | Short-term debt (Residual maturity) as per cent of total external debt | 42.6 | Short-term debt (Residual maturity) as per cent of Reserves | 57.4 | $: Inclusive of FII Investments in Government Securities. #: Commercial Borrowings are inclusive of trade credit, FII investments in corporate debt instruments and a portion of non-Government multilateral and bilateral borrowings and therefore may not tally with the figures provided in other Tables under original maturity. *: Also includes FII investments in sovereign debt and commercial paper. | Table 3: Government and Non-Government External Debt | (US$ billion) | Component | End-March | 2013 | 2014 | 2015 R | 2016 P | 1 | 2 | 3 | 4 | 5 | A. Sovereign Debt (I+II) | 81.7 | 83.7 | 89.7 | 93.4 | (As a percentage of GDP) | 4.4 | 4.4 | 4.5 | 4.6 | I. External Debt on Government Account under External Assistance | 61.3 | 62.2 | 58.5 | 61.1 | II. Other Government External Debt @ | 20.3 | 21.5 | 31.3 | 32.4 | B. Non-Government Debt # | 327.7 | 362.5 | 385.3 | 392.2 | (As a percentage of GDP) | 17.9 | 19.3 | 19.3 | 19.2 | C. Total External Debt (A+B) | 409.4 | 446.2 | 475.0 | 485.6 | (As a percentage of GDP) | 22.4 | 23.8 | 23.8 | 23.7 | P: Provisional. R: Revised @: Other Government external debt includes Defence Debt, Investment in Treasury Bills/ Government Securities by FIIs, Foreign Central Banks and International Institutions and IMF. #: Includes external debt of Monetary Authority. | Table 4: India’s Key External Debt Indicators | End-March | External Debt (US$ billion) | Ratio of External Debt to GDP (per cent) | Debt Service Ratio* (per cent) | Ratio of Foreign Exchange Reserves to Total Debt (per cent) | Ratio of Concessional Debt to Total Debt (per cent) | Ratio of Short-Term Debt to Foreign Exchange Reserves (per cent) | Ratio of Short-Term Debt to Total Debt (per cent) | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 1991 | 83.8 | 28.7 | 35.3 | 7.0 | 45.9 | 146.5 | 10.2 | 1996 | 93.7 | 27.0 | 26.2 | 23.1 | 44.7 | 23.2 | 5.4 | 2001 | 101.3 | 22.5 | 16.6 | 41.7 | 35.4 | 8.6 | 3.6 | 2006 | 139.1 | 16.8 | 10.1# | 109.0 | 28.4 | 12.9 | 14.0 | 2007 | 172.4 | 17.5 | 4.7 | 115.6 | 23.0 | 14.1 | 16.3 | 2008 | 224.4 | 18.0 | 4.8 | 138.0 | 19.7 | 14.8 | 20.4 | 2009 | 224.5 | 20.3 | 4.4 | 112.2 | 18.7 | 17.2 | 19.3 | 2010 | 260.9 | 18.2 | 5.8 | 106.9 | 16.8 | 18.8 | 20.1 | 2011 | 317.9 | 18.2 | 4.4 | 95.9 | 14.9 | 21.3 | 20.4 | 2012 | 360.8 | 21.1 | 6.0 | 81.6 | 13.3 | 26.6 | 21.7 | 2013 | 409.4 | 22.4 | 5.9 | 71.3 | 11.1 | 33.1 | 23.6 | 2014 | 446.2 | 23.8 | 5.9 | 68.2 | 10.4 | 30.1 | 20.5 | 2015 R | 475.0 | 23.8 | 7.6 | 71.9 | 8.8 | 25.0 | 18.0 | 2016 P | 485.6 | 23.7 | 8.8 | 74.2 | 9.0 | 23.1 | 17.2 | P: Provisional. R: Revised. *: The debt service ratio is defined as the sum of principal and interest payments as a proportion to current receipts. #: Works out to 6.3 per cent with the exclusion of India Millennium Deposits (IMDs) repayments of US $ 7.1 billion and pre payment of external debt of US $ 23.5 million. | Alpana Killawala Principal Adviser Press Release : 2015-2016/3047 | |