Net claims of non-residents on India dip by US$ 34.2 billion during Q4FY25 to US$ 330 billion

The Reserve Bank of India or RBI stated in a latest update that Net claims of non-residents on India declined by US$ 34.2 billion during Q4:2024-25 to US$ 330.0 billion as at end-March 2025. Higher rise in Indian residents’ overseas financial assets (US$ 60.0 billion) as compared to that in the foreign-owned assets in India (US$ 25.8 billion) led to the decline in net claims of non-residents during the quarter. Increase in reserve assets accounted for over 54 per cent of the rise in Indian residents’ overseas financial assets, followed by currency & deposits and direct investments. Rise in loans (US$ 10.0 billion) and inward direct investment (US$ 9.7 billion) together accounted for over three-fourths of the rise in foreign liabilities of Indian residents during January-March 2025.

Reserve assets accounted for 58.7 per cent of India’s international financial assets. The ratio of India’s international assets to international liabilities increased to 77.5 per cent in March 2025 from 74.8 per cent a quarter ago. The share of debt liabilities in total external liabilities increased during the quarter and stood at 54.8 per cent. During 2024-25, the net claims of non-residents declined by US$ 31.2 billion on the back of higher rise in India’s external financial assets (US $ 105.4 billion) vis-à-vis external financial liabilities (US $ 74.2 billion). Over 72 per cent of the rise in India’s overseas financial assets was due to increase in overseas direct investment, currency & deposits, and reserve assets.

Inward direct investments, loans as well as currency & deposits accounted for over three-fourths of the rise in foreign liabilities during the year. The ratio of India’s international financial assets to international financial liabilities increased to 77.5 per cent in March 2025 from 74.1 per cent a year ago. As a ratio to GDP (at current market prices), residents’ overseas financial assets increased and external financial liabilities declined during 2024-25. The ratio of net claims of non-residents on India to GDP improved to (-)8.7 per cent in March 2025 from (-)10.1 per cent a year ago, and (-)14.1 per cent five years ago.

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