A relatively lower domestic interest rates have resulted in a higher level of repayments of external borrowing in April-September, 2002, says the Economic Survey, while cautioning that redemption of Resurgent India Bonds and India Millennium Deposits proceeds is expected to sharply increase repayments during 2003-04 and 2005-06.
The Survey, tabled in Parliament on Thursday, said non-government loans worth more than $710 million were paid during 2001-02 principally on account of relatively lower interest rates prevailing in the domestic market.
The first half of the current financial year saw a negative $570 million net disbursements during the period, it said.
The period also witnessed gross disbursements on government account declining to 0.87 billion dollars as compared to $1.24 billion in the corresponding first half of 2001-02.
The Survey, however, said going by the past experience, substantial parts of the RIB and IMD proceeds might be put back in the domestic economy through re-investment in non-resident deposits or through transfer to residents.
The gross external assistance inflows (both government and non-government accounts) increased by nearly $340 million to $3.31 billion in 2001-02 and net inflows were higher by around $70 million due to a lower principal repayment of around $2.2 billion during 2001-02, it said.
Disbursement of non-government loans was also higher at $520 million in 2001-02 compared with $360 million during the previous financial year.
PTI