Business Standard

Growing demand for external commercial borrowing is a disturbing trend

For two successive years, registrations for external commercial borrowing have shot up. It is a trend the govt can't afford to ignore

Illustration: Binay Sinha
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Illustration: Binay Sinha

A K Bhattacharya
India’s demand for external commercial borrowing (ECB) saw a huge jump last year. Data compiled by the Reserve Bank of India (RBI) shows that registrations for ECB in 2018-19 shot up by 45 per cent to $41.92 billion, compared to $28.87 billion in the previous year. Isn't this a cause for concern?

Remember that ECB registrations had declined in the three consecutive years from 2014-15. They fell by 14 per cent to $28.38 billion in 2014-15 and again dropped by another 14 per cent to $24.37 billion in 2015-16 and further declined by almost 10 per cent to $21.98 billion
Disclaimer: These are personal views of the writer. They do not necessarily reflect the opinion of www.business-standard.com or the Business Standard newspaper

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