Sat, 19 May 2012 12:53:12 GMT

Weak rupee raises companies' debt by Rs 80,000 crore

The depreciating rupee is exacting a heavy toll on Indian companies. A rough calculation shows that their external debt has swollen by at least Rs 80,000 crore between March last year and now.


Weak rupee raises companies' debt by Rs 80,000 crore

The rupee has declined from 44.65 per dollar on March 31, 2011, to below 54 now.

High interest rates at home had prompted several Indian companies last year to borrow abroad to finance business plans.

RBI data show that Indian companies had external commercial borrowings worth $88.8 billion or Rs 3.96 lakh crore by end-March 2011 on their books.

These have now swelled to Rs 4.76 lakh crore in rupee terms. That is a 19 per cent expansion. However, it must be noted that this is a notional increase. These sums will fall due for repayment in instalments over the next few years.

(Continued)
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