India’s External Debt Hits a Whopping $717.9 Billion—What’s Next?

India’s external debt reached $717.9 billion by December 2024, a 10.7 percent increase from the previous year, reported PTI citing the data shared by the Finance Ministry. On a quarterly basis, debt grew 0.7 percent from $712.7 billion in September. The debt-to-GDP ratio rose slightly to 19.1 percent.

The rise was partly due to the US dollar’s appreciation, impacting the debt valuation by $12.7 billion. Excluding this, the real increase was $17.9 billion.

While non-government debt increased, central government debt declined. Non-financial corporations held the highest share at 36.5 percent, followed by deposit-taking corporations (27.8%) and the central government (22.1 percent)

Loans made up 33.6% of the debt, with currency & deposits (23.1 percent), trade credit (18.8 percent), and debt securities (16.8 percent) as other key components. Debt servicing fell slightly to 6.6 percent of current receipts, down from 6.7 percent in September. (with Inputs from PTI)