At the end of March 2026, the net claims of non-residents on India declined by US$ 52.4 billion to US$ 209.9 billion during the January-March quarter. The improvement was primarily attributed to a US$ 40.1 billion decline in foreign-owned assets in India and a US$ 12.3 billion increase in overseas financial assets held by Indian residents. Exchange rate movements also contributed to changes in the US dollar value of India's external liabilities.
The Reserve Bank of India data further showed that India's international financial position strengthened considerably during the entire financial year 2025-26. Net claims of non-residents declined by US$ 119.2 billion over the year, reflecting a US$ 42.8 billion reduction in external financial liabilities alongside a US$ 76.4 billion increase in India's overseas financial assets.
The expansion in overseas financial assets was mainly driven by higher overseas direct investment and growth in reserve assets. At the same time, lower portfolio investment and reduced direct investment by non-residents contributed to the decline in India's external financial liabilities, further improving the country's overall international financial position.
The ratio of India's international financial assets to liabilities improved significantly to 85.2 per cent in March 2026, compared with 82.0 per cent at the end of the previous quarter and 77.5 per cent a year earlier. Reserve assets accounted for 57.1 per cent of India's total international financial assets, while debt liabilities represented 56.6 per cent of the country's total external liabilities.
Another key indicator also reflected a stronger external position. The ratio of net claims of non-residents to India's Gross Domestic Product improved to negative 5.9 per cent in March 2026 from negative 9.0 per cent a year earlier, highlighting a notable strengthening in the country's international financial position and external balance sheet during the financial year.
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