India’s external debt up 12.8% to USD 295 billion

India’s external debt was up by 12.8% to around USD 296 billion at the end of September 2010 compared to the external debt level up to end of March 2010. As per the Finance Ministry data, the long-term debt was increased by 9.5% to USD 230 billion and the short-term debt was increased by 25.8% to USD66 billion.

The increase in short term debt was more because of immediate money requirement to support the economic growth recovery and to continue with the proposed fiscal stimulus and subsidy in different core sectors. After this increase India’s forex reserves which is now at around USD 295 billion, slipped below the total external debt after 7 years.

 

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