India’s International Investment Position (IIP), December 2017

The Reserve Bank released data relating to India’s international investment position (IIP) as at end-December 2017.

Key Features of India’s IIP in December 2017

  • Net claims of non-residents on India increased by US$ 26.3 billion over the previous quarter (Table 1).
  • Foreign-owned assets in India surged by US$ 38.6 billion during the quarter, with broad-based contribution from foreign direct investment (FDI), portfolio investment, currency and deposits as well as trade credit; outstanding commercial loans, however, declined marginally during the quarter.
  • Indian residents’ overseas assets increased by US$ 12.3 billion over the level in the previous quarter, a substantial portion of which came from increase in the reserve assets.
  • Appreciation of Indian rupee against the US dollar (by 2.2 per cent) during the quarter partly explained the increase in India’s liabilities when valued in US dollar terms.
  • While reserve assets accounted for over two-thirds of India’s international assets, debt and non-debt liabilities had an almost equal share in total liabilities (Table 2 and 3).
  • The ratio of India’s international financial assets to international financial liabilities stood at 58.6 per cent at end-December 2017 (59.6 per cent a quarter ago).
Table 1: Overall International Investment Position of India
(US $ billion)
Period Dec-16 (PR) Mar-17 (PR) Jun–17 (PR) Sep-17 (PR) Dec–17 (P)
Net IIP -361.6 -394.1 -406.2 -403.4 -429.7
A. Assets 543.4 564.2 576.7 595.3 607.6
1. Direct Investment 144.1 148.2 151.3 153.6 155.3
2. Portfolio Investment 2.3 2.6 2.1 2.5 2.6
    2.1 Equity Securities 2.3 1.6 2.0 2.4 2.3
    2.2 Debt Securities 0.0 1.0 0.1 0.1 0.3
3. Other Investment 38.1 43.4 36.8 39.0 40.6
    3.1 Trade Credits 1.9 1.8 1.2 1.3 1.6
    3.2 Loans 4.2 7.3 5.1 5.9 5.5
    3.3 Currency and Deposits 14.9 20.1 16.1 17.2 18.8
    3.4 Other Assets 17.1 14.3 14.4 14.7 14.7
4. Reserve Assets 358.9 370.0 386.5 400.2 409.1
B. Liabilities 905.0 958.3 982.9 998.7 1037.3
1. Direct Investment 318.5 342.6 353.2 364.1 377.7
2. Portfolio Investment 221.1 238.6 251.1 254.0 267.7
    2.1 Equity Securities 140.6 154.0 154.9 150.1 155.6
    2.2 Debt securities 80.5 84.6 96.2 103.9 112.1
3. Other Investment 365.4 377.1 378.5 380.6 391.9
    3.1 Trade Credits 84.8 88.9 89.6 93.6 98.5
    3.2 Loans 160.1 159.6 158.4 156.9 156.1
    3.3 Currency and Deposits 110.0 117.1 118.5 118.3 123.5
    3.4 Other Liabilities 10.5 11.6 12.0 11.9 13.8
Memo item: Assets to Liability Ratio (%) 60.1 58.9 58.7 59.6 58.6
R: Revised PR: Partially revised P: Provisional;
Note: The sum of the constituent items may not add to the total due to rounding off.

 

Table 2: Composition of International Financial Assets and Liabilities of India
(per cent)
Period Dec-16(PR) Mar-17(PR) June-17(PR) Sep-17(PR) Dec-17(P)
A. Assets
    1. Direct Investment 26.5 26.3 26.2 25.8 25.6
    2. Portfolio Investment 0.4 0.4 0.4 0.4 0.4
    3. Other Investment 7.0 7.7 6.4 6.6 6.7
    4. Reserve Assets 66.1 65.6 67.0 67.2 67.3
Assets/Liabilities 100.0 100.0 100.0 100.0 100.0
B. Liabilities
    1. Direct Investment 35.2 35.7 35.9 36.5 36.4
    2. Portfolio Investment 24.4 24.9 25.6 25.4 25.8
    3. Other Investment 40.4 39.4 38.5 38.1 37.8

 

Table 3: Share of External Debt and Non-Debt Liabilities of India
(per cent)
Period Dec-16(PR) Mar-17(PR) June-17(PR) Sep-17(PR) Dec-17(P)
Non-Debt Liabilities 49.2 50.3 50.1 49.9 49.9
Debt Liabilities 50.8 49.7 49.9 50.1 50.1
Total 100.0 100.0 100.0 100.0 100.0

Jose J. Kattoor
Chief General Manager

Source : RBI