The Reserve Bank released data on India’s International Investment Position for end-March 2026, showing a decline in net claims of non-residents on India during Q4:2025-26 and for FY 2025-26.
Net claims of non-residents on India declined by US$ 52.4 billion during Q4:2025-26 to US$ 209.9 billion as at end-March 2026. The RBI said this was driven by a decline in foreign-owned assets in India of US$ 40.1 billion and a rise in Indian residents’ overseas financial assets of US$ 12.3 billion.
The RBI said variation in the exchange rate of rupee vis-a-vis other currencies affected the change in liabilities when valued in US dollar terms. It said the decline in foreign liabilities of Indian residents was mainly due to lower portfolio investment and direct investment in India. It also said that increase in inward direct investment measured in rupee terms was outweighed by exchange rate depreciation, which reduced its value in US dollar terms.
During the quarter, increase in foreign direct investment accounted for more than 60 per cent of the rise in Indian residents’ overseas financial assets, followed by reserve assets. Reserve assets accounted for 57.1 per cent of India’s international financial assets, while overseas direct investment accounted for one fourth share.
The ratio of India’s international assets to international liabilities increased to 85.2 per cent in March 2026 from 82.0 per cent a quarter ago. The share of debt liabilities in total external liabilities stood at 56.6 per cent as on end-March 2026.
For FY 2025-26, net claims of non-residents declined by US$ 119.2 billion. The RBI said this was due to a decline in external financial liabilities of US$ 42.8 billion, alongside a rise in Indian residents’ overseas financial assets of US$ 76.4 billion.
It said the rise in India’s overseas financial assets during 2025-26 was mainly driven by increase in overseas direct investment and reserve assets. Fall in portfolio investment and direct investment by non-residents resulted in decline in foreign liabilities of India during the year.
The ratio of India’s international financial assets to international financial liabilities increased to 85.2 per cent in March 2026 from 77.5 per cent a year ago.
As a ratio to GDP at current market prices, residents’ overseas financial assets recorded improvement while external financial liabilities moderated during FY 2025-26. As a result, the ratio of net claims of non-residents on India to GDP improved to (-)5.9 per cent in March 2026 from (-)9.0 per cent a year ago.
Source: www.rbi.org.in.
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