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Date : Jun 30, 2021
India’s International Investment Position (IIP), March 2021

Today, the Reserve Bank released data relating to India’s International Investment Position as at end-March 2021.

Key Features of India’s IIP in March 2021

I. Quarterly Variations:

  • Net claims of non-residents on India increased by US$ 11.2 billion during Q4:2020-21 to US$ 352.7 billion in March 2021 (Table 1).

  • The increase in net claims was due to larger increase in foreign-owned assets in India (US$ 17.9 billion) vis-à-vis the overseas financial assets of Indian residents (US$ 6.7 billion) during the quarter.

  • Indian residents’ overseas financial assets abroad increased largely on the back the increase in overseas direct investment as well as currency and deposits.

  • Inward portfolio investment and loans were major contributors to the rise in India’s foreign liabilities.

  • Depreciation of the Indian rupee against the US dollar during the quarter contributed to changes in India’s liabilities, when valued in the US dollar terms.

  • Reserve assets accounted for over two-thirds of India’s international financial assets (Table 3).

  • Non-debt liabilities had 52.4 per cent share in India’s external liabilities (Table 4).

II. Annual Variations:

  • During 2020-21, non-residents’ net claims on India reduced by US $ 22.7 billion: increase in overseas assets of Indian residents (US$ 141.2 billion) exceeded the rise in foreign owned assets in India (US$ 118.5 billion) (Table 1).

  • The increase in international financial assets of Indian residents was led by a large accretion of US$ 99.2 billion in reserve assets; overseas direct investment and currency and deposits were the other major components.

  • Inward direct investment and portfolio equity investment together accounted for nearly 90 per cent of the increase in international financial liabilities during 2020-21.

  • The ratio of India’s international financial assets to international financial liabilities increased to 70.9 per cent in March 2021 from 65.6 per cent a year ago.

III. Ratio of International Financial Assets and Liabilities to GDP (at current prices):

  • The ratios of reserve assets, Indian residents’ overseas financial assets and claims of non-residents on India to GDP at current market prices surged during 2020-21, largely due to the decline in GDP during the year, caused by the COVID-19 pandemic (Table 2).

  • The ratio of net IIP of India to GDP also improved to (-) 13.1 per cent in March 2021 from (-) 13.9 per cent a year ago.

(Yogesh Dayal)     
Chief General Manager

Press Release: 2021-2022/457


Table 1: Overall International Investment Position of India
(US $ billion)
Period Mar-20(R) Jun-20(PR) Sep-20(PR) Dec-20(PR) Mar-21(P)
Net IIP -375.4 -344.6 -337.9 -341.5 -352.7
A. Assets 717.0 749.2 802.8 851.5 858.2
  1. Direct Investment 183.0 185.6 188.2 190.9 193.9
  2. Portfolio Investment 3.8 4.3 5.0 5.5 6.4
    2.1 Equity Securities 0.6 0.8 1.9 1.7 0.8
    2.2 Debt Securities 3.2 3.5 3.1 3.8 5.6
  3. Other Investment 52.4 53.6 64.8 69.3 80.9
    3.1 Trade Credits 1.5 1.1 2.8 3.2 5.6
    3.2 Loans 6.7 7.5 9.0 10.6 13.3
    3.3 Currency and Deposits 26.0 27.8 34.9 37.3 42.4
    3.4 Other Assets 18.2 17.2 18.1 18.2 19.6
  4. Reserve Assets 477.8 505.7 544.7 585.8 577.0
B. Liabilities 1,092.4 1,093.8 1,140.7 1,193.0 1,210.9
  1. Direct Investment 418.2 419.4 456.0 480.2 482.2
  2. Portfolio Investment 246.7 241.6 253.3 274.0 281.8
    2.1 Equity Securities 134.8 139.0 149.1 170.6 177.3
    2.2 Debt securities 111.9 102.6 104.2 103.4 104.5
  3. Other Investment 427.5 432.8 431.4 438.8 446.9
    3.1 Trade Credits 104.3 104.0 102.2 102.6 100.3
    3.2 Loans 179.8 184.9 180.9 184.0 190.4
    3.3 Currency and Deposits 130.8 132.9 137.5 140.7 142.1
    3.4 Other Liabilities 12.6 11.0 10.8 11.5 14.1
Memo item: Assets to Liability Ratio (%) 65.6 68.5 70.4 71.4 70.9
R: Revised; PR: Partially Revised; P: Provisional;
The sum of the constituent items may not add to the total due to rounding off.

Table 2: Ratios of External Financial Assets and Liabilities to GDP
(per cent)
Period Mar-19 (R) Mar-20 (PR) Mar-21 (P)
Net IIP (Assets - Liabilities) -16.0 -13.9 -13.1
A. Assets 23.5 26.5 31.8
  1. Direct Investment Abroad 6.2 6.8 7.2
  2. Portfolio Investment 0.2 0.1 0.2
    2.1 Equity Securities 0.0 - -
    2.2 Debt Securities 0.2 0.1 0.2
  3. Other Investment 2.0 1.9 3.0
    3.1 Trade Credits 0.0 0.0 0.2
    3.2 Loans 0.4 0.2 0.5
    3.3 Currency and Deposits 0.9 1.0 1.6
    3.4 Other Assets 0.7 0.7 0.7
  4. Reserve Assets 15.1 17.7 21.4
B. Liabilities 39.5 40.4 45.0
  1. Direct Investment in India 14.6 15.5 18.0
  2. Portfolio Investment 9.5 9.1 10.5
    2.1 Equity Securities 5.4 5.0 6.6
    2.2 Debt securities 4.1 4.1 3.9
  3. Other Investment 15.3 15.8 16.5
    3.1 Trade Credits 3.9 3.9 3.7
    3.2 Loans 6.1 6.6 7.0
    3.3 Currency and Deposits 4.8 4.8 5.2
    3.4 Other Liabilities 0.6 0.5 0.5
Note: - Negligible.

Table 3: Composition of International Financial Assets and Liabilities of India
(per cent)
Period Mar-20(R) Jun-20(PR) Sep-20(PR) Dec-20(PR) Mar-21(P)
A. Assets          
    1. Direct Investment 25.5 24.8 23.4 22.4 22.6
    2. Portfolio Investment 0.5 0.6 0.6 0.6 0.7
    3. Other Investment 7.3 7.1 8.1 8.2 9.5
    4. Reserve Assets 66.7 67.5 67.9 68.8 67.2
  Assets/Liabilities 100.0 100.0 100.0 100.0 100.0
B. Liabilities
    1. Direct Investment 38.3 38.3 40.0 40.2 39.8
    2. Portfolio Investment 22.6 22.1 22.2 23.0 23.3
    3. Other Investment 39.1 39.6 37.8 36.8 36.9

Table 4: Share of External Debt and Non-Debt Liabilities of India
(per cent)
Period Mar-20(R) Jun-20(PR) Sep-20(PR) Dec-20(PR) Mar-21(P)
Non-Debt Liabilities 48.5 48.9 50.8 52.4 52.4
Debt Liabilities 51.5 51.1 49.2 47.6 47.6
Total 100.0 100.0 100.0 100.0 100.0

1 India’s quarterly IIP is disseminated with a one-quarter lag. The IIP for end-December 2020 was released on March 31, 2021.


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