India’s external debt surged by 10% to reach $736.3 billion at the end of March 2025, up from $668.8 billion a year earlier, according to the latest data released by the Reserve Bank of India (RBI). This increase has also pushed the external debt-to-GDP ratio up from 18.5% to 19.1%, reflecting the impact of global financial conditions, rising loan demands, and currency valuation effects.
Why in News?
RBI has released data indicating a $67.5 billion increase in external debt year-on-year. Debt-to-GDP ratio has climbed to 19.1%, raising concerns over macroeconomic stability. The report breaks down debt by sector, currency denomination, and maturity structure.
Key Highlights
- Total External Debt (as of March 2025): $736.3 billion
- Previous Year (March 2024): $668.8 billion
- Increase: 10% or $67.5 billion
External Debt-to-GDP Ratio
- FY24: 18.5% → FY25: 19.1%
Valuation Effect
- Due to US dollar appreciation, the valuation effect was $5.3 billion.
- Excluding valuation impact, debt would have increased by $72.9 billion.
Debt Composition by Borrower
- Non-financial corporations: $261.7 billion
- Government: $168.4 billion
- Deposit-taking corporations (excl. RBI): $202.1 billion
Maturity Profile
- Long-term debt (maturity > 1 year): $601.9 billion
- Increase of $60.6 billion year-on-year
Short-term debt (maturity ≤ 1 year)
- Share in total debt fell from 19.1% to 18.3%
- However, short-term debt as a percentage of forex reserves rose to 20.1% from 19.7%
Debt by Currency Denomination
- US Dollar: 54.2%
- Indian Rupee: 31.1%
- Japanese Yen: 6.2%
- Special Drawing Rights (SDR): 4.6%
- Euro: 3.2%
Debt by Instrument Type
- Loans: 34%
- Currency & Deposits: 22.8%
- Trade Credit & Advances: 17.8%
- Debt Securities: 17.7%
Summary/Static | Details |
Why in the news? | India’s External Debt Rises 10% to $736.3 Billion: RBI Data |
Total External Debt (March 2025) | $736.3 billion |
External Debt (March 2024) | $668.8 billion |
Increase (YoY) | $67.5 billion (10%) |
Debt-to-GDP Ratio (FY25) | 19.1% |
Long-term Debt | $601.9 billion |
Short-term Debt Share | 18.3% |
Top Currency Share | USD (54.2%) |