India's External Debt
Question
Consider the following statements:
Which of the statements given above is/are correct?
- 1.
Most of India's external debt is owed by governmental entities.
- 2.
All of India's external debt is denominated in US dollars.
Options
1 only
2 only
Both 1 and 2
Neither 1 nor 2
Explanation
Statement 1 is incorrect: India's external debt is predominantly owed by non-governmental entities, particularly private sector corporations and commercial banks. Statement 2 is also incorrect: While US dollars constitute a significant portion of India's external debt, it is not denominated entirely in US dollars. External debt is denominated in multiple currencies including euros, Japanese yen, and other currencies, though USD remains the dominant currency. > External debt composition: Predominantly private sector; multi-currency denominated, not solely USD.
Question details
Year
2019
Paper
GS Paper 1
Question
Q63
Subject
Economy
Sub-topic
External debt composition and structure
Type
Statement-based
Difficulty
Medium
Nature
Static
Source hint
Reserve Bank of India external sector statistics
See all questions on External debt composition and structure
Browse every tagged question across all years