India's Rising External Debt Hits New Peak in March 2025

India's external debt surged by 10% to USD 736.3 billion at March 2025's end, up from USD 668.8 billion a year earlier. The debt now constitutes 19.1% of GDP, influenced by currency market fluctuations. Loans are the largest debt component, and the central bank reports short-term debt metrics.

India's external debt rose significantly by 10 per cent, reaching USD 736.3 billion at the close of March 2025, compared to USD 668.8 billion in the previous year, as stated by the Reserve Bank of India (RBI) on Friday.

This increase boosted the percentage of external debt to GDP, which now stands at 19.1 per cent, up from 18.5 per cent a year ago. The RBI highlighted a 'valuation effect' driven by the appreciation of the US dollar, adding USD 5.3 billion. Without this effect, external debt would have risen by USD 72.9 billion.

The debt consists primarily of USD 261.7 billion in loans from non-financial corporations, USD 168.4 billion by the government, and USD 202.1 billion by deposit-taking corporations, excluding the central bank. Long-term debt increased by USD 60.6 billion, while short-term debt fell in total share but rose against foreign reserves.

(With inputs from agencies.)