Census of Indias Foreign Liabilities and Assets as on March 31, 1997* (Part 4 of 5)

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Census of Indias Foreign Liabilities and Assets as on March 31, 1997* (Part 4 of 5)

SECTION IV (contd..)

OUTSTANDING LOANS AND DEFERRED EXPORT CREDIT

Indias foreign trade policies have, over the years, undergone significant changes in tandem with the perception towards its external sector and its role in the overall strategy of development. The strategy towards a greater integration of the Indian economy with the rest of the world has been pursued since 1991 and special measures were initiated to boost the exports. The EXIM policy of 1992-97 was aimed at eliminating licensing and quantitative restrictions substantially. Exporters were given income tax exemption for their export earnings. Special incentives were also given for the units set up in Export Processing Zones, Electronic Hardware Parks, 100 per cent Export Oriented Units, etc. One of the incentives given to the exporters is permission to export on deferred payment basis. Indian financial institutions like Exim Bank extended payment arrangements of sizeable magnitude.

TABLE 4.19 : CORPORATE SECTOR - CURRENCY-WISE DISTRIBUTION OF INIDIAN INVESTMENT ABROAD

						(Rs. Crore)
	End March			Variation
Currency				Absolute		Per cent
	1992	1996	1997	1992-97	1996-97	1992-97	1996-97
1	2	3	4	5	6	7	8

US Dollar	232	240	767	535	527	27.0	219.6

Pound Sterling	55	286	323	268	37	42.5	12.9

Kenyan Shilling	..	164	185	..	21	..	12.8

Jordan Dinar	..	55	99	..	44	..	80.0

Malaysian Ringgit	51	88	98	47	10	14.0	11.4

Singapore dollar	..	53	55	..	2	..	3.8

Egyptian Pound	..	7	16	..	9	..	128.6

Senegal CFA Franc	27	107	16	-11	-91	-9.9	-85.0

Thailand Baht	..	20	6	..	-14	..	-70.0

Mauritius Rupee	..	3	2	..	-1	..	-33.3

Others	405	630	650	245	20	9.9	3.2


Total	770	1,653	2,217	1447	564	23.6	34.1

(US $ million)	247	481	618	371	136	20.2	28.3

As a result, loans and deferred export credit of the corporate sector which were of more than one year maturity aggregated to Rs.2,389 crore as on March 31, 1992. It however, declined drastically to a meager Rs.119 crore as on March 31, 1996 but increased marginally to Rs.186 crore as on March 31, 1997. Iraq topped the list of countries from which deferred export claims were due followed by France, the USA, Uganda, the UK, and Iran (Table 4.20).

TABLE 4.20 : CORPORATE SECTOR - COUNTRY-WISE DISTRIBUTION OF OUTSTANDING LOANS AND DEFERRED EXPORT CREDIT

						(Rs. Crore)
	End March			Variation
Country				Absolute		Per cent
	1992	1996	1997	1992-97	1996-97	1992-97	1996-97
1	2	3	4	5	6	7	8
Iraq	1,847	42	53	-1794	11	-50.8	26.2

France	..	..	32	..	..	..

U.S.A.	..	3	25	..	22	..	733.3

Uganda	46	20	20	-26	0	-15.3	0.0

U.K.	..	23	24	..	1	..	4.3

Iran	22	15	8	-14	-7	-18.3	-46.7

Germany	..	1	7	..	6	..	600.0

Oman	..	5	6	..	1	..	20.0

Bangladesh	27	4	3	-24	-1	-35.6	-25.0

Singapore	..	2	2	..	0	..	0.0

Sri Lanka	..	2	1	..	-1	..	-50.0

Others	447	2	12	-435	10	-51.5	500.0

Total	2,389	119	186	-2203	67	-40.0	56.3

(US $ million)	765	35	52	-713	17	-41.6	49.6

Industry-wise distribution of deferred export credit is presented in Table 4.21. The manufacturing sector accounted for the major chunk of deferred export credit at Rs.160 crore (86.0 per cent), followed by trading sector at Rs.23 crore (12.4 per cent) as on March 31, 1997. The deferred export credits were mainly in terms of US dollar (52.2 per cent) and Pound sterling (8.6 per cent) (Table 4.22).

TABLE 4.21 : CORPORATE SECTOR - INDUSTRY-WISE DISTRIBUTION OF OUTSTANDING LOANS AND DEFERRED EXPORT CREDIT

								(Rs. Crore)
			End March			Variation
	Industry					Absolute		Per cent
			1992	1996	1997	1992-97	1996-97	1992-97	1996-97
	1		2	3	4	5	6	7	8
I.	Mining		..	1	2	..	1	..	100.0
				(0.8)	(1.1)

II.	Manufacturing		235	94	160	-75	66	-7.4	70.2
			(9.8)	(79.0)	(86.0)

	1.	Food & beverages	6	20	16	10	-4	21.7	-20.0
			(0.3)	(16.8)	(8.6)

	2.	Textile products	19	..	3	-16	..	-30.9	..
			(0.8)	..	(1.6)

	3.	Transport equipment	120	2	1	-119	-1	-61.6	-50.0
			(5.0)	(1.7)	(0.5)

	4.	Machinery & machine tools	5	44	60	55	16	64.4	36.4
			(0.2)	(37.0)	(32.3)

	5.	Electrical goods & machinery	1	14	65	64	51	130.5	364.3
			(0.0)	(11.8)	(34.9)

	6.	Chemicals & allied products	25	5	6	-19	1	-24.8	20.0
			(1.0)	(4.2)	(3.2)

	7.	Others	3	9	9	6	0	24.6	0.0
			(0.1)	(7.6)	(4.8)

III.	Trading		18	24	23	5	-1	5.0	-4.2
			(0.8)	(20.2)	(12.4)

IV.	Construction		1,401	..	..	-1401	..	..	..
			(58.6)

V.	Services
	of which Financial		385	..	..	-385	..	..	..
			(16.1)

IV.	Others		350	..	1	-349	..	-69.0	..
			(14.7)	..	(0.5)

Total			2,389	119	186	-2203	67	-40.0	56.3

(US $ million)			765	35	52	-713	17	-41.6	49.6

Note :

Figures in brackets indicate percentage share to total.

TABLE 4.22 : CORPORATE SECTOR - CURRENCY-WISE DISTRIBUTION OF OUTSTANDING LOANS AND DEFERRED EXPORT CREDIT

						(Rs. Crore)
	End March			Variation
Currency				Absolute		Percent
	1992	1996	1997	1992-97	1996-97	1992-97	1996-97
1	2	3	4	5	6	7	8
US Dollar	1,785	67	97	-1688	30	-44.1	44.8

Pound Sterling	..	12	16	..	4	..	33.3

Deutsche Mark	38	-	7	-31	7	-28.7	-

Singapore Dollar	..	2	2	..	0	..	0.0

Others	566	38	64	-502	26	-35.3	68.4

Total	2,389	119	186	-2203	67	-40.0	56.3

(US $ million)	765	35	52	-713	17	-41.6	49.6

BALANCES IN ACCOUNTS HELD ABROAD

The balances in accounts held abroad by corporate units, declined by 21.0 percent from Rs.2,473 crore as on March 31, 1996 to Rs.1,953 crore as on March 31, 1997. The decline may be on account of more investment opportunities to the corporate units in the foreign countries for their excess cash balances. The country-wise distribution of cash balances held abroad indicated that the USA, France, Germany, Hong Kong, Singapore, and the UK were the important countries where these balances were held (Table 4.23).

TABLE 4.23 : CORPORATE SECTOR - COUNTRY-WISE DISTRIBUTION OF BALANCES HELD ABROAD

						(Rs. Crore)
	End March			Variation
Country				Absolute		Percent
	1992	1996	1997	1992-97	1996-97	1992-97	1996-97
1	2	3	4	5	6	7	8
U.S.A	582	1,283	750	168	-533	5.2	-41.5

France	89	706	361	272	-345	32.3	-48.9

Germany	61	128	249	188	121	32.5	94.5

Hongkong	..	150	169	..	19	..	12.7

Singapore	81	6	120	39	114	8.2	1900.0

U.K.	80	46	114	34	68	7.3	147.8

Iraq	142	80	100	-42	20	-6.8	25.0

Japan	57	43	27	-30	-16	-13.9	-37.2

Sweden	..	4	25	..	21	..	525.0

Malaysia	..	9	13	..	4	..	44.4

Oman	..	2	2	..	0	..	0.0

Nepal	..	3	2	..	-1	..	-33.3

Pakistan	..	4	2	..	-2	..	-50.0

Others	650	9	19	-631	10	-50.7	111.1

Total	1,742	2,473	1,953	211	-520	2.3	-21.0

(US $ million)	558	720	544	-14	-176	-0.5	-24.4

The industry-wise distribution of cash balances held abroad is given in Table 4.24. Services industry accounted for a major share of the cash balances held abroad at Rs.1019 crore (52.2 per cent) as on March 31, 1997, followed by the manufacturing industry at Rs.736 crore (37.7 per cent).

TABLE 4.24 : CORPORATE SECTOR - INDUSTRY-WISE DISTRIBUTION OF BALANCES HELD ABROAD

								(Rs. Crore)
			End March			Variation
	Industry					Absolute		Per cent
			1992	1996	1997	1992-97	1996-97	1992-97	1996-97
	1		2	3	4	5	6	7	8
I.	Petroleum		215	61	87	-128	26	-16.6	42.6
			(12.3)	(2.5)	(4.5)

II.	Manufacturing		494	1,077	736	242	-341	8.3	-31.7
			(28.4)	(43.6)	(37.7)

	1.	Food & beverages	2	-	31	29	..	73.0	..
			(0.1)		(1.6)

	2.	Textile products	1	115	1	0	-114	0.0	-99.1
			(0.1)	(4.7)	(0.1)

	3.	Transport equipment	26	3	443	417	440	76.3	14666.7
			(1.5)	(0.1)	(22.7)

	4.	Machinery & machine tools	22	3	3	-19	0	-32.9	0.0
			(1.3)	(0.1)	(0.2)

	5.	Metal & metal products	18	442	35	17	-407	14.2	-92.1
			(1.0)	(17.9)	(1.8)

	6.	Electrical goods & machinery	1	18	27	26	9	93.3	50.0
			(0.1)	(0.7)	(1.4)

	7.	Chemicals & allied products	348	425	106	-242	-319	-21.2	-75.1
			(20.0)	(17.2)	(5.4)

	8.	Others	76	71	90	14	19	3.4	26.8
			(4.4)	(2.9)	(4.6)

III.	Trading		2	..	..	-2	..	..	..
			(0.1)

IV.	Construction & turnkey projects		117	10	15	-102	5	-33.7	50.0
			(6.7)	(0.4)	(0.8)

V.	Transport		535	24	21	-514	-3	-47.7	-12.5
			(30.7)	(1.0)	(1.1)

VI.	Utilities		40	38	74	34	36	13.1	94.7
			(2.3)	(1.5)	(3.8)

VII.	Services		..	1,262	1,019	..	-243	..	-19.3
	of which			(51.0)	(52.2)

	1.	Financial	258	1,171	928	670	-243	29.2	-20.8
			(14.8)	(47.4)	(47.5)

VIII.		Others	81	1	1	-80	0	-58.5	0.0
			(4.6)	(0.0)	(0.1)

Total			1,742	2,473	1,953	211	-520	2.3	-21.0

(US $ million)			558	720	544	-14	-176	-0.5	-24.4

Note :

Figures in brackets indicate percentage share to total.

The currency-wise composition of cash balances held abroad is given in Table 4.25 which showed that bulk of such balances was denominated in US dollar (84.0 per cent), followed distantly by Iraqi dinar (5.1 per cent), Japanese yen (4.2 per cent), and Deutsche mark (2.5 per cent).

TABLE 4.25 : CORPORATE SECTOR - CURRENCY-WISE DISTRIBUTION OF BALANCES HELD ABROAD

						(Rs. Crore)
	End March			Variation
Currency				Absolute		Per cent
	1992	1996	1997	1992-97	1996-97	1992-97	1996-97
1	2	3	4	5	6	7	8
US dollar	681	2,098	1,640	959	-458	19.2	-21.8

Iraqi Dinnar	135	80	100	-35	20	-5.8	25.0

Japanese Yen	112	145	83	-29	-62	-5.8	-42.8

Deutch Mark	62	73	49	-13	-24	-4.6	-32.9

Swedish Krona	66	4	25	-41	21	-17.6	525.0

Pound Sterling	56	8	8	-48	0	-32.2	0.0

Others	630	65	48	-582	-17	-40.2	-26.2

Total	1,742	2,473	1,953	211	-520	2.3	-21.0

(US $ million)	558	720	544	-14	-176	-0.5	-24.4

OTHER FOREIGN FINANCIAL ASSETS

The other foreign financial assets of the corporate sector include, export proceeds not realized, net assets of the Indian corporate offices abroad, receivable dividend, interest due but not received, deferred export credit with less than one year maturity, etc. Of these, export proceeds not realized alone accounted for as much as 94 per cent of the other financial assets of the corporate sector as on March 31, 1997. The country-wise distribution of these assets showed that the USA was the most important country accounting for 29.1 per cent of the other financial assets of the corporate sector at Rs.1,077 crore, followed by Japan (11.6 per cent), Italy (9.2 per cent), the UK (6.9 per cent), Hong Kong (6.1 per cent) and Bangladesh (3.5 per cent) (Table 4.26).

TABLE 4.26 : CORPORATE SECTOR - COUNTRY-WISE DISTRIBUTION OF OTHER FINANCIAL ASSETS

						(Rs. Crore)
	End March			Variation
Country				Absolute		Per cent
	1992	1996	1997	1992-97	1996-97	1992-97	1996-97
1	2	3	4	5	6	7	8
U.S.A	270	954	1,077	807	123	31.9	12.9

Japan	64	108	431	367	323	46.4	299.1

Italy	..	61	341	..	280	..	459.0

U.K.	199	187	256	57	69	5.2	36.9

Hongkong	60	312	226	166	-86	30.4	-27.6

Bangladesh	..	84	130	..	46	..	54.8

U.A.E	58	59	113	55	54	14.3	91.5

Germany	..	112	99	..	-13	..	-11.6

Switzerland	..	58	97	..	39	..	67.2

Singapore	75	99	76	1	-23	0.3	-23.2

Spain	..	38	51	..	13	..	34.2

Sri Lanka	..	52	48	..	-4	..	-7.7

Malaysia	..	16	48	..	32	..	200.0

Iraq	156	47	41	-115	-6	-23.5	-12.8

Others	1,700	794	672	-1028	-122	-16.9	-15.4

Total	2,582	2,981	3,706	1124	725	7.5	24.3

(US $ million)	827	868	1,032	206	165	4.5	19.0

Industry-wise composition of other foreign assets revealed that the manufacturing industry accounted for a lions share of other financial assets at 89.6 per cent as on March 31, 1997. The share of the services sector was 5.2 per cent in the other financial assets as on the reference date (Table 4.27).

TABLE 4.27 : CORPORATE SECTOR - INDUSTRY-WISE DISTRIBUTION OF OTHER FINANCIAL ASSETS

								(Rs. Crore)
			End March			Variation
	Industry					Absolute		Percent
			1992	1996	1997	1992-97	1996-97	1992-97	1996-97
	1		2	3	4	5	6	7	8
I.	Plantations		20	22	22	2	0	1.9	0.0
			(0.8)	(0.7)	(0.6)
II.	Mining		47	57	65	18	8	6.7	14.0
			(1.8)	(1.9)	(1.8)
III.	Petroleum		58	17	19	-39	2	-20.0	11.8
			(2.2)	(0.6)	(0.5)
IV.	Manufacturing		996	2,638	3,320	2324	682	27.2	25.9
			(38.6)	(88.5)	(89.6)
	1.	Food & beverages	66	224	224	158	0	27.7	0.0
			(2.6)	(7.5)	(6.0)
	2.	Textile products	162	286	273	111	-13	11.0	-4.5
			(6.3)	(9.6)	(7.4)
	3.	Transport equipment	121	280	297	176	17	19.7	6.1
			(4.7)	(9.4)	(8.0)
	4.	Machinery & machine tools	114	109	159	45	50	6.9	45.9
			(4.4)	(3.7)	(4.3)
	5.	Metal & metal products	17	88	434	417	346	91.2	393.2
			(0.7)	(3.0)	(11.7)
	6.	Electrical goods & machinery	106	151	530	424	379	38.0	251.0
			(4.1)	(5.1)	(14.3)
	7.	Chemicals & allied products	171	667	420	249	-247	19.7	-37.0
			(6.6)	(22.4)	(11.3)
	8.	Others	239	833	983	744	150	32.7	18.0
			(9.3)	(27.9)	(26.5)
V.	Trading		287	24	27	-260	3	-37.7	12.5
			(11.1)	(0.8)	(0.7)
VI.	Construction & turnkey projects		179	1	1	-178	0	-64.6	0.0
			(6.9)	(0.0)	(0.0)
VII.	Transport		85	1	1	-84	0	-58.9	0.0
			(3.3)	(0.0)	(0.0)
VIII.	Utilities		37	0	2	-35	2	-44.2	-
			(1.4)	(0.0)	(0.1)
IX.	Services		..	173	193	..	20	..	11.6
	of which			(5.8)	(5.2)
	1.	Financial	739	4	3	-736	-1	-66.8	-25.0
			(28.6)	(0.1)	(0.1)
X.	Others		134	48	56	-78	8	-16.0	16.7
			(5.2)	(1.6)	(1.5)
Total			2,582	2,981	3,706	1124	725	7.5	24.3
(US $ million)			827	868	1,032	206	165	4.5	19.0

Note :

Figures in brackets indicate percentage share to total.

The other financial assets were held mainly in US dollar at Rs.3,228 crore (87.1 per cent) as on March 31, 1997. Other currencies which were important from the point of view of other assets were Pound sterling (3.7 per cent), Deutsche mark (2.5 per cent), Malaysian Ringgit (0.9 per cent) and Iraqi dinar (0.9 per cent) (Table 4.28).

TABLE 4.28 : CORPORATE SECTOR - CURRENCY-WISE DISTRIBUTION OF OTHER FINANCIAL ASSETS

						(Rs. Crore)
	End March			Variation
Currency				Absolute		Per cent
	1992	1996	1997	1992-97	1996-97	1992-97	1996-97
1	2	3	4	5	6	7	8
US Dollar	1,453	2,540	3,228	1775	688	17.3	27.1

Pound Sterling	128	112	136	8	24	1.2	21.4

Deutch Mark	125	95	92	-33	-3	-5.9	-3.2

Malaysian Ringgitt	..	21	34	..	13	..	61.9

Iraqi Dinar	82	40	34	-48	-6	-16.1	-15.0

Senegal Franc	..	22	13	..	-9	..	-40.9

Japanese Yen	323	6	8	-315	2	-52.3	33.3

Singapore Dollar	..	10	7	..	-3	..	-30.0

Italian Lira	..	10	6	..	-4	..	-40.0

Swiss Franc	12	5	6	-6	1	-12.9	20.0

Others	459	120	142	-317	22	-20.9	18.3

Total	2,582	2,981	3,706	1124	725	7.5	24.3

(US $ million)	827	868	1,032	206	165	4.5	19.0