Indian Stock Market

India`s external debt increases 22.6% to USD 155 bn

India`s external debt increased 22.6% to USD 155 billion as on Mar. 31, 2007.

 

The external debt accounted for 16.4% of gross domestic product (GDP) and the total debt accumulation amounted to USD 28.5 billion.

Out of USD 155 billion of external debt, USD 15.5 billion ascribed to a valuation change as a result of the weakening US Dollar vis-à-vis other major international currencies.

 

In terms of Rupees, India`s external debt at end-March 2007 stood at Rs 6,758.57 billion.

 

According to the annual report released by the Finance Ministry, of the total external debt, as much as 56% increase was accounted for by commercial borrowings and 16% of non-resident Indians (NRIs).

 

Multilateral debt accounted for 11%, and short-term debt for 12% of the total external debt.

 

Sovereign debt stood at USD 48.6 billion at end – March 2007 and accounted for around 31.4% of total external debt stock and 5.3% in relation to GDP.

 

While the total external debt stock rose during the year, the movement in critical external debt indicators showed a mixed trend.

Debt service ratio showed a perceptible improvement, declining from 9.9% during 2005-06 to 4.8% during 2006-07. Besides, the foreign exchange reserves accounted for a cover of as much as 129% to total external debt stock. However other indicators, such as debt to GDP ratio rose, though marginally, to 16.4%, short-term debt to GDP ratio rose to 1.3%, short-term debt to total debt was up 7.7%, and short-term debt to foreign exchange assets rose to 6.2%.