Lok Sabha Question No. 265 (STARRED), answered on 2023-03-20
Subject: Central Government Debt
Ministry: FINANCE
Asked by: Nama Nageswara Rao

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF ECONOMIC AFFAIRS

## LOK SABHA

## STARRED QUESTION NO. *265

## TO BE ANSWERED ON MONDAY, THE 20 th  MARCH, 2023 PHALGUNA 29, 1944 (SAKA)

## Central Government Debt

## *265. SHRI NAMA NAGESWARA RAO:

Will the Minister of FINANCE be pleased to state:

- a. The total amount of current Central Government Debt (CGD) of the country and the amount of external debt out of CGD;
- b. Whether the external debt of the country has become heavily burdened due to steep appreciation of the US dollar in recent times against the Indian rupee and if so, the details thereof; and
- c. The measures taken/being taken/proposed to be taken by the Government to deal with the adverse effects of the US dollar appreciation on the Indian economy?

## ANSWER

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FINANCE MINISTER                                                  (SMT.NIRMALA SITHARAMAN)

(a) to (c): A Statement is placed on the Table of the House.

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## Position No. 5

## Statement referred to in reply to Lok Sabha Starred Question No. *265 for answer on 20 th   March,  2023  raised  by  Shri  Nama  Nageswara  Rao,  Member  of  Parliament regarding 'Central Government Debt'.

(a) Total amount of the Central Government Debt/liabilities is estimated at about ₹155.8 lakh  crore  (57.3%  of  GDP)  as  on  31 st March,  2023.  Out  of  this,  External  Debt  valued  at current exchange rate is estimated at ₹7.03 lakh crore (2.6% of GDP).

(b) Share  of  External  Debt  is  only  about  4.5%  of  total  debt/liabilities  of  the  Central Government and less than 3% of GDP. External debt is mostly financed by multilateral and bilateral  agencies  at  concessional  rates.  Therefore,  the  risk  profile  stands  out  as  safe  and prudent.

(c) RBI in consultation with the Government has announced various measures recently to diversify  and  expand  the  sources  of  forex  funding  to  mitigate  exchange  rate  volatility  and global spill overs. Some of such measures are provided below:

(i) Incremental  Foreign  Currency  Non-Resident  (Bank)  [FCNR(B)]  and  Non-Resident (External)  Rupee  (NRE)  deposit  liabilities  were  exempted  from  the  maintenance  of  Cash Reserve  Ratio  (CRR)  and  Statutory  Liquidity  Ratio  (SLR)  for  deposits  mobilized  up  to November 4, 2022.

(ii) Fresh  FCNR(B)  and  NRE  deposits  were  exempted  from  the  extant  regulation  on interest  rates  (i.e.  interest  rates  shall  not  be  higher  than  those  offered  by  the  banks  on comparable domestic rupee term deposits) till October 31, 2022.

(iii) The regulatory regime relating to foreign portfolio investments in debt flows has been revised to encourage foreign investment in Indian debt instruments.

(iv) The external commercial borrowing limit (under automatic route) has been raised to US$1.5 billion and the all-in-cost ceiling has been raised by 100 basis points in select cases up to December 31, 2022.

(v) In  order to  promote the  growth of exports from India and to support the increasing interest  of  the  global  trading  community  in  the  Indian  Rupee,  RBI  has  put  in  place  an additional arrangement for invoicing, payment, and settlement of exports/imports in INR on July 11, 2022 etc.

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