New Delhi, Sep 5 (Agency) India’s external debt stood at $ 620.7 billion as at end-March 2022 registering an increase of 8.2% over $573.7 billon as at end-March 2021, according to the 28th edition of Status Report on India’s External Debt 2021-22. In the forward to the report, Finance Minister Nirmala Sitharaman said that India’s external debt continues to be sustainable and prudently managed. “The long-term debt constitutes the bulk, while short-term debt is basically incurred to finance imports, enhancing the stability aspects of the total external debt,” Sitharaman said.
She further said that India’s external debt position compares well from a cross-country perspective. As per the report, India’s external debt as a ratio to GDP was 19.9% while reserves to external debt ratio was 97.8%. “External debt as a ratio to GDP fell marginally to 19.9 per cent as at end-March 2022 from 21.2 per cent a year ago. Foreign currency reserves as a ratio to external debt stood slightly lower at 97.8 per cent as at end-March 2022 than 100.6 per cent a year ago,” said the Finance Ministry in a media release on Monday. It further said that long-term debt, estimated at $499.1 billion, constituted the largest chunk of 80.4% while the short-term debt at $121.7 billion accounted for 19.6% of the total. The short-term trade credit was predominantly in the form of trade credit (96%) financing imports. The sovereign debt at $130.7 billion rose higher by 17.1% over its level a year ago, mainly because of additional allocation of SDRs by the IMF during 2021-22.
The non-sovereign debt, on the other hand, grew 6.1% to $ 490 billion over the level as at end-March 2021. Commercial borrowings, NRI deposits and short-term trade credit are the three biggest constituents of the non-sovereign debt, accounting for as much as 95.2%. “While NRI deposits declined by 2.0 per cent to US$ 139.0 billion, commercial borrowings at US$ 209.71 billion and short-term trade credit at US$ 117.4 billion rose by 5.7 per cent and 20.5 per cent, respectively,” the report said.