India's External Debt Rises to USD 747.2 Billion Amidst Currency Valuation Losses

India's external debt surged to USD 747.2 billion at the end of June 2025, a USD 11.2 billion rise compared to March, as per data released by the Reserve Bank of India on Tuesday. This increase comes alongside a slight moderation in the debt-to-GDP ratio, now at 18.9% down from 19.1% in March.

This debt escalation includes a substantial valuation loss of USD 5.1 billion, attributed to the depreciation of the US dollar relative to the Indian rupee and major currencies like the yen, euro, and Special Drawing Rights (SDR). Excluding these valuation effects, the actual increase in external debt would have been USD 6.2 billion. The long-term debt expanded by USD 10.3 billion, reaching USD 611.7 billion.

Contrastingly, short-term debt's share decreased to 18.1% of the total, down from 18.3% in March. Based on residual maturity, short-term debt accounted for 40.7% of total external debt and 43.6% of foreign exchange reserves, decreasing slightly from earlier levels. Dominating the debt composition, US dollar-denominated debt stood at 53.8%, with Indian rupee, yen, SDR, and euro following. While government external debt diminished, non-government debt rose, with non-financial corporations holding 35.9% of this debt.