Table 25.7 presents a summary of India’s external debt scenario in the 1980s based on RBI Task Force estimates. As the table shows,’ India’s external debt burden increased continuously from $ 2~.50 billion in 1.980-81 to $ 67.58 billion I m 1991-92, i.e., an increase of about 3 times over a period of 11 years. The ratio of external debt to GDP increased from 13.7 per cent in 1980-81 to 27.3 per cent in 991-92. It means that country’s debt burden increased at a faster rate than the increase in its GDP.
Note: Figures till 1988-89 are not strictly comparable with figures thereafter. Source: Economics Survey, MoF, Government of India (several issues).
The debt servicing problem increased nearly four-fold between 1980-81 and 1991-92. What is more important is the fact that the ratio of debt servicing to total receipts increased rapidly from 9.3 per cent in 1980-81 to 24.6 per cent in 1991-92.
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