At a time when rising interest rates and slowing global growth risk are tipping a large number of poor and middle income countries into debt crises, India’s external debt position remains sustainable. The country’s short-term debt, as a percentage of its total reserves, stands at 17.5%—as compared to 36.8% for China and 50.5% for South Africa. Similarly, India’s external debt stock as a percentage of gross national income is 21.4%, as compared with 51.8% for South Africa, indicating that India’s external vulnerabilities are within its comfort zone.
