d. Impact of BREXIT on India’s External Debt

♤ According to experts, the world is at the risk of a currency war after the Brexit vote, as each economy seeks to devalue its money in a bid to boost growth. The renminbi has fallen over 1 per cent after the Brexit vote as the US dollar index gained some 2 per cent in the same period.

♤ This rise was led largely by long-term external debt that accounted for 83 per cent of India's total external debt, while the share of short-term debt was only 17 per cent. The contribution of short-term debt has come down from 23.6 per cent in 2012-13 to 17 per cent in 2015-16.

♤ Our exposure to Europe is about 16.5 per cent, even if that gets impacted. In general, the direct impact on the rupee is not much. The real impact on the rupee is the spillover effect of what is happening in the rest of the world, the turmoil in the financial markets and how much that will spread.