India’s external debt rose by 7.6 per cent to $440.6 billion in 2013-14 mainly due to rise in non-resident Indians deposits, the Reserve Bank said.

India’s external debt stood at $390 billion in the previous fiscal.

“The rise in external debt was due to long-term debt particularly NRI deposits. The surge in NRI deposits reflected the impact of fresh FCNR(B) deposits mobilised under the swap scheme during September-November 2013 to tide over the difficult balance of payment (BoP) situation in the initial parts of the year,” the central bank said in a statement.
The stock of NRI deposits in India’s external debt has risen substantially recently. It increased from $47.9 billion at end-March 2010 to $70.8 billion at end-March 2013 and further to $103.8 billion at end-March 2014.

The share of FCNR(B) witnessed significant rise recently due to special swap scheme during September to November 2013. At end-March 2014, the share of FCNR(B) in total NRI deposits was 40.3 per cent.

At end-March 2014, it said, long-term external debt was $351.4 billion, showing an increase of 12.4 per cent over the level at end-March 2013.

At this level, long-term external debt accounted for 79.7 per cent of total external debt at end-March 2014 vis-a-vis 76.4 per cent at end-March 2013, it added.

The report said, short-term external debt stood at $89.2 billion at end-March 2014, showing a decline of 7.7 per cent over $96.7 billion at the end-March 2013.

“This owed to the compression in import arising from the slowdown in aggregate demand and restrictions on gold imports. Thus, the share of short-term external debt in total external debt declined from 23.6 per cent at end-March 2013 to 20.3 per cent at end-March 2014,” it said.

Government (sovereign) external debt stood at $81.5 billion at end-March 2014 vis-a-vis $81.7 billion at end-March 2013.

The share of government external debt in total external debt was lower at 18.5 per cent at end-March 2014 as compared to 19.9 per cent at end-March 2013, it said.

It further said that India’s external debt has remained within manageable limits as indicated by the external debt-GDP ratio of 23.3 per cent and debt service ratio of 5.9 per cent during 2013-14.