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 and those for the quarters ending September and December by the Ministry of Finance, Government of India. The external debt data are released with a lag of one quarter. A detailed account of external debt as compiled in the standard format as at end-March 2009 in rupee and US dollar terms and revised data for the earlier quarters are set out in Statement 1 and 2, respectively. The developments relating to India’s external debt as at end-March 2009 are discussed in the following paragraphs. Major Highlights of External Debt (i) India’s external debt, as at end-March 2009, was placed at US $ 229.9 billion (22.0 per cent of GDP) recording an increase of US $ 5.3 billion or 2.4 per cent over the level of the previous year mainly due to the increase in trade credits.
(ii) As per an international comparison of external debt of the twenty most indebted countries, India was the fifth most indebted country in 2007.
(iii) By way of composition of external debt, the share of commercial borrowings was the highest at 27.3 per cent as at end-March 2009 followed by short-term debt (21.5 per cent), NRI deposits (18.1 per cent) and multilateral debt (17.2 per cent).
(iv) The debt service ratio has declined steadily over the years, and stood at 4.6 per cent as at end-March 2009.
(v) Excluding the valuation effects due to appreciation of US dollar against other major currencies and Indian rupee, the stock of external debt would have increased by US$ 18.7 billion as compared with the stock as at end-March 2008.
(vi) The share of short-term debt in total debt increased to 21.5 per cent at end-March 2009 from 20.9 per cent at end-March 2008, primarily on account of rise in short-term trade credits.
(vii) Based on residual maturity, the short-term debt accounted for 40.6 per cent of the total external debt at end-March 2009
(viii) The ratio of short-term debt to foreign exchange reserves at 19.6 per cent in March 2009 was higher compared to 15.2 per cent in March 2008.
(ix) The US dollar continues to remain the dominant currency accounting for 57.1 per cent of the total external debt stock as at end-march 2009.
(x)India’s foreign exchange reserves provided a cover of 109.6 per cent to the external debt stock at the end of March 2009 as compared with 137.9 per cent as at end-March 2008. 1. Stock of India’s External Debt as at end-March 2009 (i) India’s external debt, as at end-March 2009, was placed at US $ 229.9 billion (22.0 per cent of GDP) recording an increase of US $ 5.3 billion or 2.4 per cent over the end-March 2008 level mainly due to the increase in trade credits. (Table 1 and Chart 1).
| Table 1: External Debt Outstanding | (US $ billion)
| | At end of | Total | Variation | | External Debt | Over corresponding Quarter of Previous year | Over Previous Quarter | | | Amount | Per cent | Amount | Per cent | | 1 | 2 | 3 | 4 | 5 | 6 | | March 2007 | 171.3 | 33.2 | 24.0 | 10.9 | 6.8 | | June 2007 | 182.3 | 37.3 | 25.7 | 11.0 | 6.4 | | September 2007 | 195.6 | 45.0 | 29.9 | 13.3 | 7.3 | | December 2007 | 206.0 | 45.6 | 28.4 | 10.4 | 5.3 | | March 2008 | 224.6 | 53.3 | 31.1 | 18.6 | 9.0 | | June 2008 | 223.6 | 41.3 | 22.6 | -1.0 | -0.5 | | September 2008 | 223.5 | 27.9 | 14.3 | 0.0 | 0.0 | | December 2008 | 229.3 | 23.3 | 11.3 | 5.7 | 2.6 | | March 2009 P | 229.9 | 5.3 | 2.4 | 0.6 | 0.3 | P: Provisional
Source: Ministry of Finance, Government of India and Reserve Bank of India. |
 2. Valuation Changes
(i) The valuation effect reflecting the appreciation of the US dollar against other major international currencies and Indian rupee resulted in a decline in India’s external debt by US $ 13.4 billion. This implies that excluding the valuation effects, the stock of external debt as at end-March 2009 would have increased by US $ 18.7 billion over the level at end-March 2008. 3. Components of External Debt (i) By way of composition of external debt, the share of commercial borrowings was the highest at 27.3 per cent as at end-March 2009 followed by short-term debt (21.5 per cent), NRI deposits (18.1 per cent) and multilateral debt (17.2 per cent) (Table 2).
(ii) The long-term debt at US$ 180.5 billion and short-term debt at US$ 49.4 billion accounted for 78.5 per cent and 21.5 per cent, respectively, of the total external debt as at end-March 2009. | Table 2: External Debt by Component | | (US $ million) | | Item | End- March | | | 1991 | 1998 | 2004 | 2005 | 2006 | 2007 | 2008 | 2009 P | | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | | 1. Multilateral | 20,900 | 29,553 | 29,297 | 31,744 | 32,620 | 35,337 | 39,490 | 39,566 | | | (24.9) | (31.6) | (26.2) | (23.9) | (23.6) | (20.6) | (17.6) | (17.2) | | 2. Bilateral | 14,168 | 16,969 | 17,277 | 17,034 | 15,761 | 16,065 | 19,701 | 20,587 | | | (16.9) | (18.1) | (15.5) | (12.8) | (11.4) | (9.4) | (8.8) | (9.0) | | 3. IMF | 2,623 | 664 | 0 | 0 | 0 | 0 | 0 | 0 | | | (3.1) | (0.7) | (0.0) | (0.0) | (0.0) | (0.0) | (0.0) | (0.0) | | 4. Trade Credit | 4,301 | 6,526 | 4,697 | 5,022 | 5,420 | 7,165 | 10,358 | 14,604 | | | (5.1) | (7.0) | (4.2) | (3.8) | (3.9) | (4.2) | (4.6) | (6.4) | | 5. ECBs | 10,209 | 16,986 | 22,007 | 26,405 | 26,452 | 41,443 | 62,337 | 62,676 | | | (12.2) | (18.2) | (19.7) | (19.9) | (19.1) | (24.2) | (27.8) | (27.3) | | 6. NRI Deposits | 10,209 | 11,913 | 31,216 | 32,743 | 36,282 | 41,240 | 43,672 | 41,554 | | | (12.2) | (12.7) | (28.0) | (24.6) | (26.3) | (24.1) | (19.4) | (18.1) | | 7. Rupee Debt | 12,847 | 5,874 | 2,720 | 2,302 | 2,059 | 1,951 | 2,016 | 1,527 | | | (15.3) | (6.3) | (2.4) | (1.7) | (1.5) | (1.1) | (0.9) | (0.7) | | 8. Long-term Debt (1to 7) | 75,257 | 88,485 | 1,07,214 | 1,15,250 | 1,18,594 | 1,43,201 | 1,77,574 | 1,80,514 | | | (89.8) | (94.6) | (96.0) | (86.7) | (85.9) | (83.6) | (79.1) | (78.5) | | 9. Short-term Debt | 8,544 | 5,046 | 4,431 | 17,723 | 19,539 | 28,130 | 46,999 | 49,373 | | | (10.2) | (5.4) | (4.0) | (13.3) | (14.1) | (16.4) | (20.9) | (21.5) | | Total (8+9) | 83,801 | 93,531 | 1,11,645 | 1,32,973 | 1,38,133 | 1,71,331 | 2,24,573 | 2,29,887 | | | (100.0) | (100.0) | (100.0) | (100.0) | (100.0) | (100.0) | (100.0) | (100.0) | P: Provisional
IMF: International Monetary Fund; ECBs: External Commercial Borrowings; NRI: Non-Resident Indian
Note: Figures in parentheses are percentage to total external debt.
Source: Ministry of Finance, Government of India and Reserve Bank of India. | (iii) The rise in external debt stock was mainly due to the increase in trade credits which rose by US$ 4.2 billion over its level at end-March 2008.
(iv) The short-term debt increased by US$ 2.4 billion as at end-March 2009 mainly on account of rise in short-term trade credits (Table 3 and Chart 2).
(v) Outstanding NRI deposits at US $ 41.6 billion as at end-March 2009 declined by US $ 2.1 billion over the level at end-March 2008 mainly due to valuation effects as there was positive inflows under NRI deposits during 2008-09. | Table 3: Variation in External Debt by Components | | Item | External debt outstanding
at the end-of
(US $ million) | Absolute variation
(US $ million) | Percentage variation
(per cent) | | Mar 07 | Mar 08 | Mar 09P | Mar 07
to
Mar 08 | Mar 08
to
Mar 09 | Mar 07 to
Mar 08 | Mar 08
to
Mar 09 | | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | | 1. Multilateral | 35,337 | 39,490 | 39,566 | 4,153 | 76 | 11.8 | 0.2 | | 2. Bilateral | 16,065 | 19,701 | 20,587 | 3,636 | 886 | 22.6 | 4.5 | | 3. IMF | 0 | 0 | 0 | 0 | 0 | 0.0 | 0.0 | | 4. Trade Credit | 7,165 | 10,358 | 14,604 | 3,193 | 4,246 | 44.6 | 41.0 | | 5.Commercial Borrowings | 41,443 | 62,337 | 62,676 | 20,894 | 339 | 50.4 | 0.5 | | 6. NRI Deposits | 41,240 | 43,672 | 41,554 | 2,432 | -2,118 | 5.9 | -4.8 | | 7. Rupee Debt | 1,951 | 2,016 | 1,527 | 65 | -489 | 3.3 | -24.3 | 8. Short-Term Debt
Of which:
(i) Short-Term Trade Credit | 28,130 | 46,999 | 49,373 | 18,869 | 2,374 | 67.1 | 5.1 | | 25,979 | 43,162 | 45,975 | 17,183 | 2,813 | 66.1 | 6.5 | | Total Debt (1 to 8) | 171,331 | 224,573 | 229,887 | 53,242 | 5,314 | 31.1 | 2.4 | | Memo Items | | | | | A. Long-Term Debt (1 to 7) | 143,201 | 177,574 | 180,514 | 34,373 | 2,940 | 24.0 | 1.7 | | B. Short-Term Debt | 28,130 | 46,999 | 49,373 | 18,869 | 2,374 | 67.1 | 5.1 | P: Provisional
Source: Ministry of Finance, Government of India and Reserve Bank of India. |
 (vi) The level of approvals of ECBs during 2008-09 (April-March) was significantly lower at US$ 18.4 billion as compared to US$ 31.0 billion during 2007-08. As a result, gross disbursements for 2008-09 were lower at US $ 13.4 billion than that of US$ 28.8 billion during the previous year (Table 4). | Table 4: External Commercial Borrowings | | (US $ million) | | Year | Approvals# | Gross Disbursement* | Amortisation* | Interest* | Total Servicing | ECB Debt Outstanding | | 1 | 2 | 3 | 4 | 5 | 6 (4+5) | 7 | | 1990-91 | 1,903 | 4,252 | 2,004 | 1,410 | 3,414 | 10,209 | | 1995-96 | 6,286 | 4,252 | 3,868 | 1,380 | 5,248 | 13,873 | | 2000-01 | 2,837 | 9,621 | 5,378 | 1,695 | 7,073 | 24,408 | | 2001-02 | 2,653 | 2,684 | 4,107 | 1,456 | 5,563 | 23,320 | | 2002-03 | 4,235 | 3,505 | 5,019 | 1,167 | 6,186 | 22,472 | | 2003-04 | 6,671 | 5,225 | 8,045 | 2,119 | 10,164 | 22,007 | | 2004-05 | 11,490 | 9,084 | 3,571 | 959 | 4,530 | 26,405 | | 2005-06 | 17,175 | 14,343 | 11,584 | 3,015 | 14,599 | 26,452 | | 2006-07 | 24,492 | 20,257 | 3,814 | 2,583 | 6,397 | 41,443 | | 2007-08 PR | 30,954 | 28,784 | 6,119 | 3,652 | 9,771 | 62,337 | | 2008-09 QE | 18,364 | 13,377 | 6,439 | 3,962 | 10,401 | 62,676 | PR : Partially Revised ; QE: Quick Estimates.
*: Revised; based on Balance of Payments data.
# : Based on date of agreement of the loan which may differ from the date of granting the loan registration number by the RBI. Ceiling on ECB approvals is fixed on the basis of the latter, which may either be after or before the date of agreement of the loan. Hence, there may be some difference between the amount shown under approvals in the table and the amount of ceiling fixed for a particular year.
Note: Disbursements during 1998-99 and 2000-01 include RIBs (US$ 4.2 billion) and IMDs (US $ 5.5 billion), respectively. Debt service payments during 2003-04 and 2005-06 include redemption of RIBs and IMDs, respectively. | 4. Currency Composition (i) The currency composition of India’s external debt is generally disseminated in terms of major foreign currencies such as US dollar, Japanese Yen, Euro, Pound Sterling, Special Drawing Rights (SDR) and the domestic currency i.e., Indian Rupee. (ii) The US dollar continues to be the dominant currency accounting for 57.1 per cent of the total external debt stock as at end-March 2009, followed by the Japanese yen (14.2 per cent), Indian rupee (13.2 per cent) and SDR (9.2 per cent) (Table 5 and Chart 3). The share of Euro has been at around 4 per cent in the recent years. Table 5: Currency Composition of External Debt
(Percentage share in total external debt) | | | As at end March | | Currency | 2004 | 2005 | 2006 | 2007 | 2008 | 2009 P | | 1 | 2 | 3 | 4 | 5 | 6 | 7 | | US Dollar | 40.5 | 48.0 | 49.2 | 51.4 | 54.4 | 57.1 | | SDR | 15.5 | 14.2 | 13.7 | 11.9 | 10.0 | 9.2 | | Indian Rupee | 22.7 | 19.6 | 18.9 | 18.6 | 17.5 | 13.2 | | Japanese Yen | 11.6 | 10.5 | 10.9 | 11.5 | 12.0 | 14.2 | | Euro | 5.8 | 4.6 | 4.4 | 3.9 | 3.6 | 4.1 | | Pound Sterling | 3.4 | 2.6 | 2.6 | 2.4 | 2.2 | 1.9 | | Others | 0.5 | 0.5 | 0.3 | 0.3 | 0.3 | 0.3 | | Total | 100.0 | 100.0 | 100.0 | 100.0 | 100.0 | 100.0 | P: Provisional
Source: Ministry of Finance, Government of India and Reserve Bank of India. |
5. Instrument-wise Classification of External Debt (i) The instrument-wise classification of India’s external debt as at end-March 2009 reveals that ‘loans’ accounted for 51.8 per cent of total debt outstanding as compared to 49.5 per cent as at end-March 2008 (Table 6). (ii)The group ‘currency and deposits’ and ‘trade credits’ together accounted for 50.6 per cent of the total non-Government debt as at end-March 2009 as against 52.6 per cent as at end-March 2008. | Table 6: Instrument-wise Classification of External Debt Outstanding | (US$ million) | | Sr. No. | Borrower | End-March 2008 | End-March 2009 | | 1 | 2 | 3 | 4 | | A. | Government (1+2) | 56,947 | 54,856 | | 1. | Short-Term | 615 | 939 | | | (i) Money Market Instruments | 615 | 939 | | 2. | Long-term {(i)+(ii)+(iii)} | 56,332 | 53,917 | | | (i) Bonds and Notes | 2,300 | 963 | | | (ii) Loans | 52,740 | 51,680 | | | (iii) Trade Credits | 1,292 | 1,274 | | B. | Monetary Authority | 1,115 | 764 | | 1. | Short-term | 1,115 | 764 | | | (i) Currency and Deposits | 1,115 | 764 | | C. | Non-Government (1+2) | 1,66,511 | 1,74,267 | | 1. | Short-Term {(i)+(ii)} | 45,269 | 47,670 | | | (i) Money Market Instruments | 2,107 | 1,695 | | | (ii) Trade Credits | 43,162 | 45,975 | | 2. | Long-term {(i)+(ii)+(iii)+(iv)} | 1,21,242 | 1,26,597 | | | (i) Bonds and Notes | 18,302 | 17,018 | | | (ii) Loans | 58,484 | 67,310 | | | (iii) Currency and Deposits | 43,672 | 41,554 | | | (iv) Trade Credits | 784 | 715 | | | Total External Debt (A+B+C) | 2,24,573 | 2,29,887 | | Source: Ministry of Finance, Government of India and Reserve Bank of India. | 6. Short-term Debt (i) The short-term debt has become an important component for measuring the liquidity and refinancing risks. In the recent years, efforts have been taken to expand the coverage of short-term external debt. The data on short-term debt now includes suppliers’ credit up to and above 180 days, FII investments in Government debt, investment by foreign central banks and international institutions in Treasury Bills and external liabilities of central banks and commercial banks. (ii) Short-term debt by original maturity has increased over the period mainly because of the increase in trade related credits due to growing imports. The share of trade related credits in total short-term debt increased from 91.8 per cent as at end-March 2008 to 93.1 per cent as at end-March 2009 (Table 7). | Table 7: Short-Term Debt by Original Maturity | (US $ million) | | Components | End-March | | 1991 | 2001 | 2005 | 2006 | 2007 | 2008 | 2009 | | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | | A | Short-Term Debt | 8,544 | 3,628 | 17,723 | 19,539 | 28,130 | 46,999 | 49,373 | | | a) NRI Deposits (up to 1 year maturity) @ | 3,577 | 957 | 0 | 0 | 0 | 0 | 0 | | | b) FC (B&O) Deposits (up to 1 year maturity) | 167 | 0 | 0 | 0 | 0 | 0 | 0 | | | c) Trade Related Credits # | 4,800 | 2,671 | 16,271 | 19,399 | 25,979 | 43,162 | 45,975 | | | (i) Above 6 months and upto 1year | 2,267 | 2,671 | 7,529 | 8,696 | 11,971 | 22,884 | 23,346 | | | (ii) Upto 6 months | 2,533 | 0 | 8,742 | 10,703 | 14,008 | 20,278 | 22,629 | | | d) FII Investments in Government Treasury Bills & other instruments | 0 | 0 | 1,452 | 140 | 397 | 651 | 2,065 | | | e) Investment in Treasury Bills by foreign central banks and international institutions etc. | - | - | - | - | 164 | 155 | 105 | | | f) External Debt Liabilities of: | - | - | - | - | 1,590 | 3,031 | 1,228 | | | (i) Central Bank | - | - | - | - | 501 | 1,115 | 764 | | | (ii) Commercial Bank | - | - | - | - | 1,089 | 1,916 | 464 | | B | Imports (during the year)* | 27,915 | 57,912 | 1,18,908 | 1,57,056 | 1,90,670 | 2,57,789 | 2,94,587 | | C | Trade Credits to Imports (%) | 17.2 | 4.6 | 13.7 | 12.4 | 13.6 | 16.7 | 15.6 | @: Short-term deposits of less than one-year maturity under FCNR(A) were withdrawn with effect from May 15, 1993, such deposits under FCNR(B) and NR(E)RA were withdrawn effective October 1999 and April 2003, respectively.
#: Data on short-term Trade Credits of less than six months in respect of suppliers’ credit and FII investment in debt papers are included since end-March 2005.
*: On balance of payments basis.
Source: Ministry of Finance, Government of India and Reserve Bank of India | 7. External Debt by Residual Maturity (i) While external debt is generally compiled in terms of original maturity, analysing the external debt, in particular short term debt in terms of residual maturity is important from the point of view of foreign exchange liquidity management and to ascertain the total foreign exchange outgo on account of debt service payments in the immediate future.
(ii) The ‘short-term debt by residual maturity’ comprises the repayments due under medium and long-term debt by original maturity during one year reference period along with the short-term debt with original maturity. The balance constitutes the long-term debt by residual maturity. Based on residual maturity, the short-term debt accounted for 40.6 per cent of total external debt as at end-March 2009. The ratio of short-term debt by residual maturity to foreign exchange reserves worked out to 37.0 per cent at end-March 2009 (Table 8). Table 8: Residual Maturity of External Debt Outstanding as at End-March 2009 | (US $ million) | | | Short-term | Long-term | Total
(2) to (5) | | Components | Up to one year | 1 to 2 years | 2 to 3 years | More than 3 years | | 1 | 2 | 3 | 4 | 5 | 6 | | 1. Sovereign Debt (long-term) | 2,603 | 2,924 | 3,015 | 45,376 | 53,917 | | 2. External Commercial Borrowings (including trade credit) | 9,189 | 10,839 | 14,521 | 50,494 | 85,043 | | 3. NRI deposits {(i)+(ii)+(iii)} | 32,108 | 4,465 | 3,757 | 1,224 | 41,554 | | (i) FCNR(B) | 9,944 | 2,085 | 1,075 | 107 | 13,211 | | (ii) NR(E)RA | 18,649 | 2,015 | 2,041 | 865 | 23,570 | | (iii) NRO | 3,516 | 365 | 641 | 252 | 4,773 | | 4. Short-term Debt* (Original maturity) | 49,373 | - | - | - | 49,373 | | Total (1 to 4) | 93,273 | 18,228 | 21,293 | 97,093 | 229,887 | | Memo Items | | | | | | | Short-term debt (Residual maturity as per cent of total debt | 40.6 | | | | | | Short-term debt (Residual maturity as per cent of Reserves) | 37.0 | | | | | * Also includes short-term component of sovereign debt amounting to US$ 939 million.
Note: Residual Maturity of NRI Deposits is estimated on the basis of the Survey conducted by the Reserve Bank on NRI deposits outstanding as on March 31, 2009.
Source: Ministry of Finance, Government of India and Reserve Bank of India. | 8. Government and Non-Government External Debt (i) Government (Sovereign) external debt stood at US$ 54.9 billion as at end-March 2009 while non-Government debt amounted to US $ 175.0 billion. (ii) The share of non-Government debt in total external debt has increased steadily since March 2003. This trend continued during 2008-09 as the share of non-Government debt in total external debt increased further to 76.1 per cent as at end-March 2009 as against 74.6 per cent as at end-March 2008 (Table 9 and Chart 4). | Table 9: Government and Non-Government External Debt | | (US $ million) | | Sr. No. | Components | End-March | | 2003 | 2004 | 2005 | 2006 | 2007 | 2008 | 2009 | | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | | A. | Sovereign Debt (I+II) | 43,612 | 44,674 | 46,668 | 45,346 | 48,330 | 56,947 | 54,856 | | | (As a percentage of GDP) | 8.4 | 7.2 | 6.5 | 5.6 | 5.1 | 4.8 | 5.3 | | I. | External Debt on Government Account under External Assistance | 41,216 | 41,142 | 43,686 | 43,510 | 46,155 | 52,538 | 51,816 | | II. | Other Government External Debt @ | 2,396 | 3,532 | 2,982 | 1,768 | 2,175 | 4,409 | 3,040 | | B. | Non-Government Debt # | 61,302 | 66,971 | 86,305 | 92,787 | 1,23,001 | 1,67,626 | 1,75,031 | | | (As a percentage of GDP) | 11.9 | 10.6 | 12.0 | 11.5 | 13.0 | 14.2 | 16.8 | | C. | Total External Debt (A+B) | 1,04,914 | 1,11,645 | 1,32,973 | 1,38,133 | 1,71,331 | 2,24,573 | 2,29,887 | | | (As a percentage of GDP) | 20.3 | 17.8 | 18.5 | 17.2 | 18.1 | 19.0 | 22.0 | @: Other Government external debt includes defence debt, investment in Treasury Bills/ Government securities by FIIs, foreign central banks and international institutions.
#: Includes external debt of Monetary Authority.
Source: Ministry of Finance, Government of India and Reserve Bank of India |
 9. Debt Service Payments (i) India’s debt service payments amounted to US $ 15.4 billion during 2008-09 (April-March) as compared to US $14.9 billion during 2007-08 (April-March) (Table 10).
(ii) India’s debt service ratio1 has improved progressively over the years owing to the combined effect of moderation in debt service payments and growth in external current receipts. The debt service ratio had declined from a peak of 35.3 per cent in 1990-91 to 5.9 per cent in 2004-05 but increased to 10.1 per cent during 2005-06 due to repayments relating to the India Millennium Deposits. The debt service ratio declined to 4.6 per cent during 2008-09. (iii) Servicing of External Commercial Borrowings (including principal and interest payments) accounted for 67.4 per cent of the total debt service during 2008-09. | Table 10: India’s External Debt Service Payments | | (US $ million) | | Sr. No. | Item | 1990-91 | 2000-01 | 2003-04 | 2004-05 | 2005-06 | 2006-07 | 2007-08 | 2008-09 | | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | | 1 | External Assistance | 2,315 | 3,444 | 6,983 | 2,855 | 2,652 | 2,942 | 3,241 | 3,381 | | | Repayment | 1,187 | 2,338 | 6,193 | 2,129 | 1,945 | 1,960 | 2,099 | 2,372 | | | Interest | 1,128 | 1,106 | 790 | 726 | 707 | 982 | 1,142 | 1,009 | | 2 | External Commercial Borrowings | 3,414 | 7,073 | 10,164 | 4,530 | 14,839 | 6,331 | 9,771 | 10,401 | | | Repayment | 2,004 | 5,378 | 8,045 | 3,571 | 11,824 | 3,814 | 6,119 | 6,439 | | | Interest | 1,410 | 1,695 | 2,119 | 959 | 3,015 | 2,517 | 3,652 | 3,962 | | 3 | I.M.F. | 778 | 26 | 0 | 0 | 0 | 0 | 0 | 0 | | | Repayment | 644 | 26 | 0 | 0 | 0 | 0 | 0 | 0 | | | Interest | 134 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | | 4 | NRI Deposits Interest | 1,282 | 1,661 | 1,642 | 1,353 | 1,497 | 1,969 | 1,813 | 1,547 | | 5 | Rupee Debt Service Repayments | 1,193 | 617 | 376 | 417 | 572 | 162 | 121 | 101 | | 6 | Total Debt Service (1 to 5) | 8,982 | 12,821 | 19,165 | 9,155 | 19,560 | 11,404 | 14,946 | 15,430 | | | Repayment | 5,028 | 8,359 | 14,614 | 6,117 | 14,341 | 5,936 | 8,339 | 8,912 | | | Interest | 3,954 | 4,462 | 4,551 | 3,038 | 5,219 | 5,468 | 6,607 | 6,518 | | 7 | Current Receipts # | 25,479 | 77,467 | 1,19,239 | 1,54,123 | 1,94,170 | 2,42,811 | 3,14,014 | 3,37,095 | | | Debt Service Ratio (6/7) (%) | 35.3 | 16.6 | 16.1 | 5.9 | 10.1 | 4.7 | 4.8 | 4.6 | #: Current Receipts minus Official Transfers.
Source: Ministry of Finance, Government of India and Reserve Bank of India | (vi) At end-March 2009, the projected debt service payments for External Commercial Borrowings (ECBs) and Foreign Currency Convertible Bonds (FCCBs) revealed that the principal repayments between 2011-12 and 2012-13 would be higher (Table 11). Despite consolidation of high cost loans and lower interest rates on the current borrowings, interest payments would also increase during these years due to higher disbursement. The projections do not include future debt service obligations arising out of fresh borrowings. | Table 11: Projected Debt Service Payments for ECBs and FCCBs | | (US $ million) | | Year | Principal | Interest | Total | | 1 | 2 | 3 | 4 | | 2009-10 | 8,633 | 2,057 | 10,690 | | 2010-11 | 10,239 | 1,996 | 12,235 | | 2011-12 | 13,877 | 2,367 | 16,244 | | 2012-13 | 15,823 | 2,141 | 17,964 | | 2013-14 | 10,256 | 961 | 11,217 | | 2014-15 | 5,608 | 627 | 6,235 | | 2015-16 | 3,786 | 465 | 4,251 | | 2016-17 | 3,602 | 331 | 3,933 | | 2017-18 | 2,285 | 212 | 2,497 | | 2018-19 | 1,655 | 135 | 1,790 | Note: Projections on debt servicing are based on the end-March 2009 debt outstanding position.
The projections exclude NRI deposits and FII investment in government debt securities. | 10. Sustainability of India’s External Debt (i) An assessment of sustainability of external debt is generally undertaken based on the trends in certain key ratios such as debt to GDP ratio, debt service ratio, short-term debt to total debt and total debt to foreign exchange reserves. India has managed its external debt successfully as reflected in the perceptible improvement in various external debt sustainability indicators (Table 12).
(ii) The ratio of external debt to GDP increased to 22.0 per cent as at end-March 2009 from 19.0 per cent as at end-March 2008. (iii) The debt service ratio has declined steadily over the years, and stood at 4.6 percent as at end-March 2009. (iv) India’s foreign exchange reserves provided a cover of 109.6 per cent to the external debt stock at the end of March 2009 as compared to 137.9 per cent as at end-March 2008 (Chart 5). (v) The share of concessional debt in total external debt declined to 18.2 per cent as at end-March 2009 from 19.7 per cent at end-March 2008 reflecting the continuing increase in non-concessional private debt in India's external debt stock. (vi) The ratio of short-term debt to foreign exchange reserves at 19.6 per cent as at end-March 2009 was higher than that of 15.2 per cent in the previous year. (vii) The share of short-term debt in total debt increased to 21.5 per cent at end-March 2009 from 20.9 per cent at end-March 2008. | Table 12: India’s Key External Debt Indicators | | Year | 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 | | 1990-91 | 83.8 | 28.7 | 35.3 | 7.0 | 45.9 | 146.5 | 10.2 | | 1995-96 | 93.7 | 27.0 | 26.2 | 23.1 | 44.7 | 23.2 | 5.4 | | 2000-01 | 101.3 | 22.5 | 16.6 | 41.7 | 35.4 | 8.6 | 3.6 | | 2001-02 | 98.8 | 21.1 | 13.7 | 54.7 | 35.9 | 5.1 | 2.8 | | 2002-03 | 104.9 | 20.3 | 16.0* | 72.5 | 36.8 | 6.1 | 4.5 | | 2003-04 | 111.6 | 17.8 | 16.1** | 101.2 | 36.1 | 3.9 | 4.0 | | 2004-05 | 133.0 | 18.5 | 5.9^ | 106.4 | 30.9 | 12.5 | 13.3 | | 2005-06 | 138.1 | 17.2 | 10.1# | 109.8 | 28.6 | 12.9 | 14.1 | | 2006-07 | 171.3 | 18.1 | 4.7 | 116.2 | 23.1 | 14.1 | 16.4 | | 2007-08 | 224.6 | 19.0 | 4.8 | 137.9 | 19.7 | 15.2 | 20.9 | | 2008-09P | 229.9 | 22.0 | 4.6 | 109.6 | 18.2 | 19.6 | 21.5 | P: Provisional
* Works out to 12.4 per cent, with the exclusion of prepayment of external debt of US $ 3,430 million.
** Works out to 8.2 per cent with the exclusion of pre payment of external debt of US $ 3,797 million. and redemption of Resurgent India Bonds (RIBs) of US $ 5,549 million.
^ works out to 5.7 per cent with the exclusion of pre payment of external debt of US $ 381 million.
# 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.
Source: Ministry of Finance, Government of India and Reserve Bank of India |
 11. Cross Country Comparison (i) According to the latest data available on Global Development Finance Online Database, World Bank, the international comparison of external debt of the twenty most indebted countries indicates that India was the fifth most indebted country in 2007 as compared with third position in 1990 (Table 13). (ii) The element of concessionality in India’s external debt portfolio was the third highest after Indonesia and Philippines. (iii) India’s debt service ratio was third lowest with China and Malaysia having first and second lowest debt service ratio, respectively. (iv) In terms of ratio of external debt to Gross National Income (GNI), India’s position was sixth lowest, with China having the lowest ratio of external debt to GNP. (v) India’s position with respect to short-term debt to total external debt was eighth lowest with Mexico having the lowest ratio of short-term debt to total external debt. (vi) In terms of reserves to total debt, India’s position was fourth as China, Malaysia and Thailand had higher reserves to debt ratio than India. | Table 13: International Comparison of Top Twenty Debtor Countries, 2007 | | | External debt stocks, total
(US $ billion) | Concessional debt/Total debt
(EDT)
(per cent) | Debt service ratio
(per cent) | External Debt to GNI
(per cent) | Short-term debt/Total debt (EDT) (per cent) | Forex Reserves to
Total Debt
(per cent) | | 1 | 2 | 3 | 4 | 5 | 6 | 7 | | China | 373.6 | 10.1 | 2.2 | 11.6 | 54.5 | 413.9 | | Russian Federation | 370.2 | 0.4 | 9.1 | 29.4 | 21.4 | 129.1 | | Turkey | 251.5 | 2.1 | 32.1 | 38.8 | 16.6 | 30.4 | | Brazil | 237.5 | 1.0 | 27.8 | 18.7 | 16.5 | 75.9 | | India | 224.6 | 19.7 | 4.8 | 19.0 | 20.9 | 137.9 | | Poland | 195.4 | 0.4 | 25.6 | 47.7 | 30.9 | 33.6 | | Mexico | 178.1 | 0.6 | 12.5 | 17.7 | 5.1 | 49.0 | | Indonesia | 140.8 | 26.2 | 10.5 | 33.9 | 24.8 | 40.4 | | Argentina | 127.8 | 1.3 | 13.0 | 49.7 | 29.8 | 36.1 | | Kazakhstan | 96.1 | 1.0 | 49.6 | 103.7 | 12.2 | 18.4 | | Romania | 85.4 | 1.6 | 19.1 | 51.5 | 35.7 | 46.8 | | Ukraine | 73.6 | 2.2 | 16.9 | 52.9 | 31.1 | 44.1 | | Philippines | 65.8 | 20.0 | 13.7 | 41.9 | 10.8 | 51.2 | | Thailand | 63.1 | 9.6 | 8.1 | 26.5 | 34.3 | 138.7 | | Chile | 58.6 | 0.4 | 14.2 | 40.3 | 22.7 | 28.7 | | Malaysia | 53.7 | 6.1 | 4.6 | 29.4 | 28.4 | 189.9 | | Croatia | 48.6 | 2.1 | 33.0 | 97.7 | 10.5 | 28.1 | | Colombia | 45.0 | 2.1 | 22.0 | 22.5 | 11.9 | 46.6 | | South Africa | 43.4 | 0.0 | 5.9 | 15.8 | 38.2 | 75.9 | | Venezuela, RB | 43.1 | 0.5 | 7.4 | 18.7 | 27.1 | 78.2 | Source: Data for India as published by national authorities for 2007-08 and those for other countries as at
end-December 2007 as available in World Bank’s Global Development Finance Online Database. | (vii) The Quarterly External Debt (QEDS) database, jointly developed by the World Bank and the International Monetary Fund, brings out detailed external debt data of countries that are subscribing to IMF’s Special Data Dissemination Standard/ General Data Dissemination System. The position in respect of the reporting countries for the third and fourth quarters of the calendar year 2008, which has been published by the World Bank (http://go.worldbank.org/6V603CE490) is given at Annex I. Annex I: Gross External Debt Position of QEDS Reporting
Countries for End-September and End-December 2008 | | (US$ million) | | Sr. No. | Countries | 2008 Q3 | 2008 Q4 | | Short-term | Long-term | Total | Short-term | Long-term | Total | | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | | 1 | Argentina | 53,660 | 75,277 | 1,28,937 | 56,253 | 71,859 | 1,28,112 | | 2 | Armenia | 429 | 2,748 | 3,177 | 465 | 2,962 | 3,427 | | 3 | Australia | 2,73,741 | 5,65,950 | 8,39,691 | 2,28,190 | 5,35,482 | 7,63,671 | | 4 | Austria | 3,03,048 | 5,61,405 | 8,64,453 | 2,65,533 | 5,61,961 | 8,27,494 | | 5 | Belarus | 8,755 | 5,802 | 14,557 | 7,253 | 7,565 | 14,818 | | 6 | Belgium | 12,02,725 | 4,20,123 | 16,22,848 | 9,64,129 | 3,82,388 | 13,46,517 | | 7 | Bolivia | 317 | 5,484 | 5,801 | 267 | 5,656 | 5,923 | | 8 | Brazil | 47,507 | 2,25,459 | 2,72,966 | 36,466 | 2,26,466 | 2,62,931 | | 9 | Bulgaria | 18,913 | 32,909 | 51,822 | 18,493 | 32,624 | 51,117 | | 10 | Canada | 2,99,552 | 5,10,854 | 8,10,406 | 3,01,712 | 4,49,599 | 7,51,311 | | 11 | Chile | 18,616 | 50,426 | 69,042 | 14,251 | 50,517 | 64,768 | | 12 | Colombia | 5,616 | 39,793 | 45,409 | 5,684 | 40,708 | 46,392 | | 13 | Costa Rica | 3,509 | 5,297 | 8,805 | 3,864 | 5,218 | 9,082 | | 14 | Croatia | 4,123 | 47,721 | 51,843 | 6,620 | 47,830 | 54,450 | | 15 | Czech Republic | 28,553 | 61,187 | 89,740 | 25,941 | 54,487 | 80,428 | | 16 | Denmark | 2,88,064 | 3,00,587 | 5,88,651 | 2,99,226 | 2,84,127 | 5,83,353 | | 17 | Ecuador | 0 | 0 | 0 | 0 | 0 | 0 | | 18 | Egypt | 2,651 | 29,831 | 32,481 | 2,842 | 29,281 | 32,123 | | 19 | El Salvador | 1,497 | 8,873 | 10,369 | 1,542 | 9,149 | 10,691 | | 20 | Estonia | 9,982 | 17,077 | 27,059 | 10,623 | 16,778 | 27,401 | | 21 | Finland | 1,17,488 | 2,26,735 | 3,44,223 | 1,09,624 | 2,18,935 | 3,28,559 | | 22 | France | 22,47,510 | 28,90,585 | 51,38,095 | 21,38,532 | 28,63,164 | 50,01,696 | | 23 | Georgia | 1,062 | 6,081 | 7,143 | 972 | 6,330 | 7,302 | | 24 | Germany | 19,78,058 | 34,50,105 | 54,28,163 | 17,23,723 | 35,26,777 | 52,50,499 | | 25 | Greece | 1,29,621 | 3,70,543 | 5,00,164 | 1,56,216 | 3,48,397 | 5,04,612 | | 26 | Hong Kong, China | 5,10,248 | 1,67,531 | 6,77,779 | 4,83,877 | 1,76,053 | 6,59,931 | | 27 | Hungary | 26,422 | 1,83,990 | 2,10,412 | 26,111 | 1,83,523 | 2,09,634 | | 28 | India | 50,675 | 1,72,856 | 2,23,531 | 46,625 | 1,82,646 | 2,29,271 | | 29 | Indonesia | 20,264 | 1,31,475 | 1,51,739 | 20,488 | 1,34,578 | 1,55,067 | | 30 | Ireland | 10,81,982 | 13,08,683 | 23,90,665 | 11,10,636 | 12,01,087 | 23,11,724 | | 31 | Israel | 35,512 | 53,423 | 88,935 | 32,956 | 52,312 | 85,268 | | 32 | Italy | 9,44,407 | 16,07,011 | 25,51,418 | 8,09,594 | 15,49,516 | 23,59,110 | | 33 | Japan | 12,51,745 | 8,02,838 | 20,54,583 | 14,66,347 | 8,78,336 | 23,44,683 | | 34 | Kazakhstan | 10,946 | 95,117 | 1,06,064 | 10,174 | 97,639 | 1,07,813 | | 35 | Korea | 1,89,598 | 2,35,918 | 4,25,516 | 1,51,056 | 2,29,439 | 3,80,495 | | 36 | Kyrgyz Republic | 292 | 3,060 | 3,352 | 385 | 3,082 | 3,467 | | 37 | Latvia | 15,014 | 27,452 | 42,466 | 14,091 | 27,963 | 42,054 | | 38 | Lithuania | 9,066 | 24,426 | 33,492 | 8,169 | 24,299 | 32,469 | | 39 | Malaysia | 38,796 | 43,355 | 82,151 | 30,892 | 44,399 | 75,292 | | 40 | Mexico | 28,679 | 1,83,493 | 2,12,172 | 24,218 | 1,76,175 | 2,00,393 | | 41 | Moldova | 1,299 | 2,596 | 3,895 | 1,429 | 2,696 | 4,125 | | 42 | Netherlands | 12,57,438 | 14,31,377 | 26,88,815 | 10,68,222 | 13,71,643 | 24,39,864 | | 43 | Norway | 3,02,466 | 2,56,742 | 5,59,208 | 2,74,891 | 2,76,705 | 5,51,596 | | 44 | Paraguay | 710 | 2,653 | 3,363 | 735 | 2,772 | 3,507 | | 45 | Peru | 8,934 | 26,931 | 35,865 | 6,148 | 28,440 | 34,587 | | 46 | Poland | 62,275 | 2,03,832 | 2,66,107 | 50,809 | 1,91,248 | 2,42,057 | | 47 | Portugal | 1,95,715 | 3,08,391 | 5,04,106 | 1,80,351 | 3,04,359 | 4,84,710 | | 48 | Russian Federation | 1,15,759 | 4,26,322 | 5,42,082 | 79,779 | 4,04,948 | 4,84,726 | | 49 | Slovak Republic | 20,255 | 32,791 | 53,045 | 20,102 | 32,424 | 52,527 | | 50 | Slovenia | 17,842 | 39,257 | 57,100 | 16,170 | 38,240 | 54,409 | | 51 | South Africa | 27,978 | 49,547 | 77,525 | 25,462 | 46,349 | 71,811 | | 52 | Spain | 7,12,137 | 16,93,443 | 24,05,580 | 6,91,557 | 16,22,086 | 23,13,643 | | 53 | Sweden | 0 | 0 | 0 | 0 | 0 | 0 | | 54 | Switzerland | 9,99,466 | 4,31,423 | 14,30,890 | 9,12,796 | 3,92,161 | 13,04,956 | | 55 | Thailand | 21,201 | 44,023 | 65,224 | 20,317 | 44,529 | 64,846 | | 56 | Tunisia | 4,602 | 16,010 | 20,612 | 4,330 | 16,442 | 20,773 | | 57 | Turkey | 57,804 | 2,32,911 | 2,90,715 | 50,714 | 2,26,120 | 2,76,834 | | 58 | Ukraine | 29,345 | 75,494 | 1,04,839 | 21,983 | 81,253 | 1,03,236 | | 59 | United Kingdom | 80,71,790 | 26,77,095 | 1,07,48,884 | 69,80,002 | 24,08,010 | 93,88,012 | | 60 | United States | 53,47,436 | 82,80,023 | 1,36,27,459 | 54,14,396 | 82,27,411 | 1,36,41,807 | | 61 | Uruguay | 351 | 10,863 | 11,214 | 115 | 10,626 | 10,742 | 1 Debt service ratio is defined as total repayments of principal and interest on debt as a ratio of current receipts. Ajit Prasad
Manager Press Release : 2008-2009/2117 |