The outstanding debt of Indias non-financial sector (NFS ) stood at Rs 322 trillion or 167.3 per cent of GDP in 1QFY21, up from around 153 per cent in the past few quarters.
According to a report by Motilal Oswal Institutional Equities, a 9.1 per cent year on year growth in NFS debt and 0.6 per cent year on year decline in annualized nominal GDP led to a jump in NFS’ debt-to-GDP ratio in 1QFY21.
Within NFS, general government (Centre plus states) debt grew at a 30-quarter high pace of 14.3 per cent year on year, the report said.
Moreover, nongovernment non-financial (NGNF4) debt grew 4.6 per cent YoY in 1QFY21 (against record-low growth levels of 4 per cent in 4QFY20).
Within the NGNF sector, household debt grew at near-record lows of 6 per cent YoY in 1QFY21 (8.9 per cent in 4QFY20, but slowest growth of 5.7 per cent in 4QFY09).
Additionally, non-financial corporate (NFC) debt grew 3.7 per cent, the second lowest to record-low growth levels of 1 per cent in 4QFY20. “A look at long-term trends suggests the country’s debt growth weakened to the single digits for the first time in two decades in 2QFY20, and COVID-19 failed to change this in 1QFY21,” the report said.