India’s external debt rises 10.1% to $736.3 billion as of end-March 2025

Reserve Bank of India

India's external debt rose by $67.5 billion to $736.3 billion as of the end of March 2025, according to the Reserve Bank of India’s (RBI) data. In percentage terms, total debt increased by 10.1 percent by March 2025 over the previous year, excluding the valuation effect.

The external debt-to-GDP ratio increased to 19.1 percent as of end-March 2025 from 18.5 percent as of end-March 2024, the RBI data showed.

The valuation effect due to the appreciation of the US dollar vis-à-vis the Indian rupee and other currencies amounted to $5.3 billion. Excluding the valuation effect, external debt would have increased by $72.9 billion instead of $67.5 billion as of end-March 2025 compared to a year earlier.

Long-term debt rises

Long-term debt (with original maturity of above one year) was placed at $601.9 billion as of end-March 2025, registering an increase of $60.6 billion over its level of end-March 2024. The share of short-term debt (with original maturity up to one year) in total external debt declined to 18.3 percent as of end-March 2025 from 19.1 percent a year earlier, the RBI said.

However, the ratio of short-term debt (original maturity) to foreign exchange reserves increased to 20.1 percent as of end-March 2025 (19.7 percent as of end-March 2024).

Short-term debt on a residual maturity basis (i.e., debt obligations that include long-term debt by original maturity falling due over the next 12 months and short-term debt by original maturity) constituted 41.2 percent of total external debt as of end-March 2025 against 43.4 percent a year earlier. It also accounted for 45.4 percent of foreign exchange reserves, compared to 44.9 percent in March 2024.

The debt structure

The share of outstanding debt of non-financial corporations in total external debt was the highest at 35.5 percent, followed by deposit-taking corporations (except the central bank) (27.5 percent), general government (22.9 percent) and other financial corporations (9.4 percent).

Loans remained the largest component of external debt, with a share of 34.0 percent, followed by currency and deposits (22.8 percent), trade credit and advances (17.8 percent) and debt securities (17.7 percent).