According to the World Bank’s latest International Debt Report (IDR) 2024, India’s total external debt has increased by USD 31 billion to USD 646.79 billion in 2023.The report revealed that interest payment increased from USD 15.08 billion (in 2022) to USD 22.54 billion (in 2023).
- As per the report, the total external debt owed by all Low-and-Middle-Income Countries (LMICs) reached record USD 8.8 trillion, which marks an increase of 8% over 2020.
- While, the debt for the International Development Association (IDA)-eligible nations touched to USD 1.1 trillion, an increase of approximately 18%.
About IDR 2024:
i.The report is published annually by the World Bank Group (WB), which provides comprehensive information about external debt statistics and analysis for the LMICs that report to the World Bank Debtor Reporting System (DRS).
ii.This latest edition of the report provides in-depth analysis of end-2023 external debt flows and debt stock positions as well as the macroeconomic and debt outlook for 2024 and beyond.
India-Specific:
i.As per the report, the long-term debt stocks have increased by 7% to USD 498 billion in 2023, while short-term debt stocks decreased marginally to USD 126.32 billion in 2023.
ii.The report showed that external debt stock as percentage of exports was 80%, while debt servicing 10% exports in 2023.
iii.The report further revealed that net debt inflows was USD 33.42 billion, while the net equity inflows was higher at USD 46.94 billion in 2023.
World Bank Approved USD 188.28 Million Loan to Boost Growth in Maharashtra’s Districts
On 3rd December 2024, the World Bank has approved a USD 188.28 million loan to Maharashtra in order to boost its economy, particularly in underdeveloped districts of the state.
- The loan will be provided by the WB’s International Bank for Reconstruction and Development (IBRD) and will have a maturity period of 15 years, including a 5 year grace period.
- The loan is granted under the WB’s program “Maharashtra Strengthening Institutional Capabilities in Districts for Enabling Growth” which will enhance district planning and growth strategies.
Note: At present, out of 36 districts of Maharashtra, only 7 contribute to over half of the USD 500 billion state Gross Domestic Product (GDP).
Key Points:
i.As per this loan arrangement, Maha Databank, a data governance framework will be created to address development challenges, including gender disparities.
- Also, districts will receive fiscal incentives on achieving annual performance targets.
ii.The initiative will enhance Maharashtra’s online service portals, MAITRI 2.0 for business services and the RTS portal for government services, improving seamless access to resources for the private sector.
About World Bank (WB):
President– Ajay Banga
India’s Director – Auguste Tano Kouamé
Headquarters– Washington, DC, the United States of America (USA)
Established– 1944
