India’s external debt increased to $736.3 billion in March 2025

According to a recent Reserve Bank of India (RBI) report, India’s external debt increased to $736.3 billion by the end of March 2025. This represents 19.1% of the Gross Domestic Product (GDP), up from $668.8 billion (18.5% of GDP) a year earlier.

The report notes a valuation effect of $5.3 billion due to the appreciation of the US dollar against the Indian rupee and other currencies. Excluding this valuation effect, the external debt would have risen by a higher $72.9 billion, rather than the reported $67.5 billion increase from March 2024.

Key Highlights of Debt Composition:

• Borrower Categories:
  • Non-financial corporations accounted for the largest share, with loans totaling $261.7 billion.
  • Deposit-taking corporations (excluding the central bank) held $202.1 billion in debt.
  • The government’s external debt stood at $168.4 billion.
• Maturity Profile: The share of short-term debt (with original maturity up to one year) in total external debt saw a slight decline, falling to 18.3% at March-end 2025 from 19.1% a year ago.
• Currency Denomination: US dollar-denominated debt continued to be the largest component, making up 54.2% of India’s total external debt as of March-end 2025.
• Debt Instruments: Loans remained the primary debt instrument, constituting 34% of external debt, followed by currency and deposits at 22.8%.