Net claims of non-Indians on India rise $1.4 billion to $380.9 billion as on Sept. 23

The net claims of non-residents on India rose marginally $1.4 billion during Q2:2023-24 to $380.9 billion in September 2023 from $379.5 billion in the previous quarter but declined $5.6 billion from $386.5 billion in the year ago period as per the India’s International Investment Position (IIP) data released by the Reserve bank of India (RBI) on Friday.

Foreign-owned financial assets in India recorded higher increase ($7.4 billion) vis-à-vis Indian residents’ overseas financial assets ($6.0 billion), which led to the increase in net claims of non-residents, data shows

According to RBI Indian residents’ foreign assets increased during July-September 2023 quarter due to rise in currency and deposits as well as overseas direct investment, even though reserve assets and loans declined during the quarter. 

Despite some reduction in direct investment liabilities, India’s total foreign liabilities rose sharply during Q2:2023-24 to US$1,313.7 billion from US$1,233.3 billion in the previous quarter due to increase in portfolio and other investments.

Reserve assets accounted for 63% of India’s international financial assets at end-September 2023, data shows. 

Variation in the exchange rate of the Indian rupee vis-à-vis other currencies impacted the change in liabilities, when valued in US dollar terms, the central bank said adding the ratio of India’s international financial assets to international financial liabilities improved to 71% in September 2023 as compared with 68.7% a year ago.

The share of debt liabilities in total external liabilities rose marginally to 50.3% in September 2023 as compared with 49.8% a year ago.

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