India's external debt rises to $730 billion: Is it alarming?
India's external debt climbed to over $730 billion by the end of March 2025, up $67.5 billion from last year, according to the Finance Ministry.
The debt-to-GDP ratio nudged up to 19.1%, but with foreign exchange reserves covering over 90% of what's owed, the government considers the position modest and under control.
Breakdown of the debt
Most of this debt—about 82%—is long-term, mainly borrowed by non-financial companies.
Short-term debts (mostly import-related) make up the rest.
The US dollar dominates at 54% of what India owes, while the rupee covers about a third.
Is this a cause for concern?
Not really.
Even though the numbers sound big, India's financial health looks steady for now.
Debt payments are expected to get easier going forward, thanks to solid reserves and stable risk factors—so no need for panic headlines just yet!