Srinagar, June 29: With a widening current account deficit and continued uncertainty in global economic scenario and prospects for equity flows, dependence on debt flows rose considerably during 2011-12, an RBI handout said today.
 It said the external debt stock increased during 2011-12, and key vulnerability indicators like debt-GDP ratio and debt service ratio witnessed deterioration over the year.
 Giving details, the central bank statement said:  India’s external debt ended March 2012 was US $ 345.8 billion (20 per cent of GDP) recording an increase of US $ 39.9 billion or 13 per cent over the corresponding period a year before, on account of significant increase in commercial borrowings, short-term trade credits, and rupee denominated Non-resident Indian deposits.
 Excluding the valuation effects due to appreciation of US dollar primarily against Indian Rupee, the stock of external debt has increased by US$ 51.8 billion over the stock as at end-March 2011, it added.
 Giving further details it said that the share of commercial borrowings stood highest at 30.2 per cent as at end-March 2012 followed by short-term debt (22.6 per cent), NRI deposits (16.9 per cent) and multilateral debt (14.6 per cent).
 “The short-term debt increased by US$ 13.2 billion on account of rise in short-term trade credits, FII investment in T-bills and commercial banks borrowings,” it said, adding that the debt service ratio increased to 5.6 per cent during 2011-12 as compared to 4.2 per cent during 2010-11.
 Based on residual maturity, short-term debt accounted for 42.7 per cent of the total external debt as at end-March 2012. Whereas the share of short-term debt, by original maturity, was 22.6 per cent of the total external debt stock.
 The ratio of short-term debt (residual maturity) to foreign exchange reserves at 50.1 per cent as at end- March 2012 was higher compared to 42.3 per cent as at end-March 2011.
 The US dollar denominated debt accounted for 55 per cent of the total external debt stock as at end-March 2012 followed by Indian rupee (21.4 per cent) and Japanese Yen (9.1 per cent).
 India’s foreign exchange reserves provided a cover of 85.1 per cent to the external debt stock at the end of March 2012 as compared with 99.6 per cent as at end-March 2011.

COMPONENTS OF EXTERNAL DEBT
 The RBI said that almost all the components of the external debt recorded a rise during the year.
 “The loans under external assistance (multilateral and bilateral debt) increased by around US $ 3.0 billion during 2011-12 as compared with an increase of US$ 8.7 billion in the preceding year,” it said.
 Trade credits (both long-term and short-term) increased, by US $ 8.0 billion, as at end-March 2012 as compared to US$ 12.8 billion over the level at end-March 2011.
 The commercial borrowings increased by US$ 15.8 billion as at end-March 2012 as compared to an increase of US $ 17.8 billion as at end-March 2011 during the corresponding period of the preceding year.
 The short-term debt increased by US$ 13.2 billion to US$ 78.2 billion as at end-March 2012 as compared to US$ 65.0 billion as at end-March 2011 on account of rise in short-term trade credits, FII investment in T-bills and commercial banks borrowings.
 NRI deposits increased by US$ 6.9 billion to US $ 58.6 billion as at end-March 2012 over the level as at end-March 2011 primarily on account of increase in rupee denominated NRI deposits reflecting the impact of deregulation of interest rates on these deposits in December 2011.

Lastupdate on : Fri, 29 Jun 2012 21:30:00 Makkah time
Lastupdate on : Fri, 29 Jun 2012 18:30:00 GMT
Lastupdate on : Sat, 30 Jun 2012 00:00:00 IST