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India's external debt rose to USD 629.1 billion at June-end 2023, debt-GDP ratio declined: RBI

Sep 29, 2023

By: BlinkX Research Team

According to the Reserve Bank of India data released on Thursday, India's external debt increased slightly to USD 629.1 billion at June-end 2023, even though the debt-to-GDP ratio decreased.

The debt increased from USD 624.3 billion at the end of March by around USD 4.7 billion.

"The external debt to GDP ratio declined to 18.6 percent at end-June 2023 from 18.8 percent at end-March 2023," RBI said.

The valuation effect of the US dollar's increase against key currencies such as the yen and SDR amounted to USD 3.1 billion.

With a share of 54.4 percent at the end of June 2023, US dollar-denominated debt remained the biggest component of India's external debt, followed by debt denominated in Indian rupees (30.4%), SDR (5.9%), yen (5.7%), and euro (3.0%).

Excluding the value effect, external debt would have climbed by USD 7.8 billion rather than USD 4.7 billion by the end of June 2023 compared to the end of March 2023, according to the central bank.

According to the data, long-term debt (with the original maturities of more than one year) was at USD 505.5 billion at the end of June 2023, up USD 9.6 billion from the previous quarter's ending.

Short-term debt (with the original maturities of up to one year) accounted for 19.6 percent of total external debt at the end of June 2023, down from 20.6 percent at the end of March 2023.

The RBI also stated that the general government's outstanding debt declined, but non-government debt climbed at the end of June 2023.

Non-financial companies had the biggest percentage of outstanding debt in total external debt, at 39.8 percent, followed by deposit-taking corporations (excluding the central bank) (26.6 percent), general government (21.1 percent), and other financial companies (7.6 percent).

Furthermore, loans remained the greatest component of external debt, accounting for 32.9 percent, followed by currency and deposits, trade credit and advances, and debt securities.