External debt (or foreign debt) is the total debt a country owes to foreign creditors, complemented by internal debt owed to domestic lenders. The debtors can be the government, corporations or citizens of that country.
After the BoP crisis of 1991, India’s prudent external debt policies and management with a focus on sustainability, solvency, and liquidity have helped to limit the size of external debt to a moderate level
The rise in total external debt in recent years is due to long-term commercial borrowings and NRI deposits.
Important features of India’s external debt:
Major portion long-term debt than short-term debt.
Most part of debt is hold by non-governmental debt.
Non-concessional debt (commercial loans borrowed by the non-governmental body) accounts 91.3% while concessional is just 8.7%
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