Munich Personal RePEc Archive

Financing of India’s Balance of Payments: The Role of Debt Creating Flows

George, Justine (2012): Financing of India’s Balance of Payments: The Role of Debt Creating Flows. Published in: Erudition , Vol. 2, No. 2 (1 June 2012)

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Abstract

Existences of high cost of borrowing were one of main the reason for shifting of financing BoP away from debt flows in the post liberalization period. After a reduction in the share of debt flows between 2001-02 and 2003-04, it again bears an important part of net capital flows since 2003-04. Unlike in the past, these debt flows were productively used because the end use of ECB mainly concentrated on import of capital goods, project purpose and modernisation rather than used for loan refinancing, working capital and rupee expenditure.

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