External Sector and Currency
The RBI released the quarterly IIP data for the end of June 2026, showing that net claims of non‑residents on India increased by US$16.5 billion during Q1 2026‑27, reaching a total of US$220.3 billion. This rise was driven primarily by an expansion of external liabilities by US$11.6 billion, while foreign‑owned assets fell by US$4.9 billion. Consequently, the ratio of India’s international assets to international liabilities moderated to 84.6 % in June 2026, down from 85.7 % in the previous quarter.
Capital Markets and Flows
Foreign liabilities of Indian residents grew mainly on account of higher direct investment, which rose by US$15.7 billion, and other investment, which increased by US$4.2 billion. These inflows offset a decline in portfolio equity investments of US$14 billion. The detailed breakdown of assets shows total international assets of US$1,212.5 billion, comprising US$316.1 billion in direct investment (US$208.7 billion in equity and investment‑fund shares, US$107.4 billion in debt instruments), US$23.4 billion in portfolio investment (US$16.0 billion in equity and US$7.4 billion in debt securities), US$204.4 billion in other investment, and US$668.6 billion in reserve assets, which together represent 55.1 % of the asset side. On the liability side, total external liabilities stood at US$1,432.8 billion, with direct investment liabilities of US$560.9 billion, portfolio investment liabilities of US$224.0 billion, and other investment liabilities of US$647.9 billion.
Financial Stability
The share of debt liabilities in total external liabilities continued its upward trend, reaching 56.9 % in June 2026, while non‑debt liabilities fell to 43.1 %. Reserve assets, a key component of external buffers, accounted for 55.1 % of international financial assets, underscoring the resilience of India’s external position.
Overall, the June 2026 IIP data indicate a modest weakening of the asset‑liability ratio, driven by higher external liabilities and a slight contraction in foreign‑owned assets, but the continued dominance of reserve assets and a balanced composition of debt and non‑debt liabilities suggest a stable external financial framework.