India's external debt stood at $480 billion at Dec-end: Finance Ministry

New Delhi: India's total external debt inched up marginally to USD 480.2 billion at end-December compared to end-March last year, Finance Ministry said in a report.

The total external debt stock at end-December was recorded an increase of USD 4.9 billion over its level at end-March.

Government (Sovereign) external debt stood at USD 90.7 billion at end-December 2015 while non-government debt amounted to USD 389.5 billion.

The report said India's external debt has remained within manageable limits as indicated by external debt indicators.

"The Prudent external debt management policy of government of India has helped in containing rise in external debt and maintaining a comfortable external debt position," it said.

The "policy continues to focus" on monitoring long- and short-term debt, raising sovereign loans on concessional terms with longer maturities, regulating ECBs, and rationalising interest rates on Non-Resident Indian deposits.

While debt witnessed modest decline at end-December 2015 sequentially (quarter-on-quarter), on year-on-year basis however, it recored a growth of 4.7 percent.

Long-term external debt increased by 2.2 percent or USD 8.8 billion, while short-term debt registered a decline of 4.6 percent or USD 3.9 billion.

"Thus, the maturity profile of India's external debt continues to be dominated by long-term loans," it said.

Talking about valuation effect, the report said the US dollar appreciated against Indian rupee and other most major currencies between March 2015 and December 2015.

"Excluding the valuation effect, the external debt would have been higher at USD 488.1 billion at end-December 2015," it said.

The valuation effect arises because external debt is denominated in different currencies, and the US dollar value which is the international numeraire for debt, fluctuates over time vis-a-vis other currencies.

The share of long-term debt in total external debt increased from 82 percent at end-March 2015 to 83 percent at end-December 2015.

Long-term debt at USD 398.6 billion at end-December 2015 recorded an increase of USD 8.8 billion over end-March 2015.

The rise in long-term external debt was primarily due to higher commercial borrowings and NRI deposits.

At end-December 2015, commercial borrowings stood at USD 183.6 billion, reflecting an increase of 1.5 percent, while NRI deposits at USD 122.6 billion rose by 6.5 percent over the end-March 2015 level.

Commercial borrowings and NRI deposits together accounted for 63.8 percent of India's total external debt (long-term and short-term) at end-December 2015.

During end-March 2010 and end-March 2015, the ratio of government debt to GDP was in the range of 4.4 to 4.7 percent. The increase in 'Other Government External Debt-Long- term' in recent years reflects the level of FII investment in government securities.

As per the report, US dollar denominated debt accounted for 57.6 percent of India's total external debt, followed by Indian rupee (28.7 percent), SDR (5.8 percent), Japanese Yen (4.1 percent) and Euro (2.3 percent).

India's key debt indicators compare well with other indebted developing countries. The ratio of India's external debt stock to gross national income (GNI) at 22.7 percent was the third lowest.