3% decrease in India’s external debt in FY17

India’s external debt came down by $13.1 billion to $471.9 billion at the end of March this year on annual basis. This 2.7 percentage decrease in debt has been mainly due to decrease in NRI deposits and commercial borrowings.

The debt has remained within manageable limits and the situation has improved in 2016-17 over 2015-16, said ‘India’s External Debt: A Status Report 2016-17’ by the Department of Economic Affairs. The external debt-GDP ratio fell to 20.2 per cent at the end of March 2017 from 23.5 per cent at March 2016. At end-March 2017, long-term external debt was $383.9 billion, showing a decrease of 4.4 per cent year-on-year.

Long-term external debt accounted for 81.4 per cent of total external debt at end-March 2017. “Short-term external debt increased by 5.5 per cent to $88 billion at end-March 2017. This is mainly due to the increase in trade related credits, a major component of short-term debt with a share of 98.3 per cent,” the report said.

A cross country comparison based on ‘International Debt Statistics 2017’ of the World Bank, which presents the debt data for 2015, shows that India continues to be among the less vulnerable countries with its external debt indicators comparing well with other indebted developing countries. The ratio of India’s external debt stock to Gross National Income (GNI) was the fifth lowest and in terms of the cover provided by foreign exchange reserves to external debt, the position was sixth highest in 2015.

Sources: The Financial Express, ANI

Deadline to use 500 notes ‘Preponed’

The Government of India preponed the deadline of some specific utility payments of demonetised Rs 500 notes from December 15 to December 2, 2016.

Earlier the Government relieved the citizens by announcing that the banned 500 currency could be used at petrol pumps and airline ticket counters until December 15, but soon they took back their decision creating confusion among the public.

The government announced the demonetization on November 8,2016 and gave two-day relief for utility payments. Later as the new currency was unavailable to many, the deadline extended to November 24 and more to December 15. But the extension was cut short for a few utilities.

The news was confirmed after Ministry of Finance retweeted the Press Trust of India’s tweet. PTI informed that the old notes will be accepted for utility bill payments and railway bookings until December 15 but not for fuel purchase or airline ticketing. Petrol pumps and air tickets counters will accept the old currency until December 2. Though Rs 1000 is limited to a few utilities only. Also, the plan to use the old currency for highway tolls from December 3 to December 15 has been dropped.

The move is taken after misuse of exemption for money laundering was reported.

SOURCES : The Hindu, Economic Times

IMAGE SOURCE : Deccan Chronicle