20l2-l3

ANNUAL RPORT
Ministry of linance
(Budget Division)
Government of lndia
i
1. Economic Division 1
2. Budget Division 4
3. Capital Markets Division 8
4. Infrastructure and Energy Division 19
5. Investment Division 28
6. Multilateral Institutions Division 35
7. Multilateral Relations Division 41
8. Aid Accounts & Audit Division 45
9. Administration Division 46
10. Bilateral Cooperation Division 52
11. Integrated Finance Division 56
12. Directorate of Currency 56
Organisation 58
1. Establishment Division 59
2. Pay Research Unit (PRU) 59
3. Integrated Finance Unit (IFU) 60
4. Procurement Policy Division 60
5. Plan Finance-I Division 61
6. Finance Commission Division 65
7. Plan Finance-II Division 66
8. Staff Inspection Unit 66
9. Controller General of Accounts (CGA) 67
10. Chief Controller of Accounts (CCA) 76
11. Office Chief Adviser Cost 76
12. Use of Hindi as Official Language 77
13. National Institute of Financial Management (NIFM) 78
Organisation Chart 85
INTRODUCTION v
Contents
CHAPTER I
Department of Economic Affairs
Page No.
CHAPTER II
Department of Expenditure
ii
Material for inclusion in Chapter I
Material for inclusion in Chapter III
1. Organization and Functions 87
2. Revenue Headquarters Administration 88
3. Narcotics Control Division 90
4. State Taxes Section 100
5. Adjudicating Authority under Prevention of Money
Laundering Act, 2002 104
6. Appellate Tribunal under Prevention of Money
Laundering Act, 2002 104
7. Appellate Tribunal for Forfeited Property 104
8. Set up for Forfeiture of Illegally Acquired Property 105
9. Central Board of Excise and Customs 106
10. Customs, Excise & Service Tax Appellate Tribunal 145
11. Customs & Central Excise Settlement Commission 146
12. Authority for Advance Rulings (Central Excise,
Customs and Service Tax) 147
13. Central Board of Direct Taxes 149
14. Income Tax Settlement Commission 238
15. Authority for Advance Ruling (Income Tax) 239
16. Central Economic Intelligence Bureau 241
17. Directorate of Enforcement 243
18. Financial Intelligence Unit, India (FIU-IND) 250
19. Integrated Finance Division 251
20. National Committee for Promotion of Social
and Economic Welfare 253
21. National Institute of Public Finance and Policy 254
22. Implementation of Official Language Policy 254
23. Implementation of Right to Information Act, 2005 255
Organisation Chart 258
Annexure-I Representation of SCs/STs/OBCs 259
Annexure-II- Representation of PWDs 268
CHAPTER III
Department of Revenue
iii
1. Functions of the Department 273
2. Vision 273
3. Mission 273
4. Organisational Structure 273
5. Policy on Disinvestment 273
6. Approach to Disinvestment 274
7. Benefits of Disinvestment 274
8. Reform measures and policy initiatives 274
9. Performance/achievements 275
10. Proceeds from disinvestment 276
11. National Investment Fund (NIF) 277
12. Official Language Policy 277
13. E-Governance 277
14. Grievance Redressed Mechanism 277
15. Vigilance Machinery 277
16 . Implementation of Right to Information Act, 2005. 277
17. Result Framework Document 2012-13 278
18. Audit Paras/Objections 278
19. Integrated Finance Unit 278
Organisation Chart 279
1. Banking Operations and Accounts 284
2. Regional Rural Banks 285
3. Financial Inclusion 286
4. Agricultural Credit Targets 287
5. Industrial Relations 289
6. Debts Recovery Tribunals 289
7. Financial Institutions 290
8. Vigilance 299
9. Pension Reforms 300
10. Credit Policy 301
11. Insurance Division 306
Organisation Chart 327
Organisation Chart 328
CHAPTER IV
Department of Disinvestment
CHAPTER V
Department of FinanciaI Services
iv
For Public Contract Purposes:
Ministry of Finance
Department of Economic Affairs
North Block, New Delhi 110001
Phone : 23095120, 23092453
Website: http://www.finmin.nic.in/the _ministry/dept_eco_affairs/index.asp
Department of Expenditure
North Block, New Delhi 110001
Phone : 23095661, 23095613
Website: http://www.finmin.nic.in/the _ministry/dept_expenditure/index.asp
Department of Revenue
North Block, New Delhi 110001
Phone : 23095384, 23095385
Website: http://www.finmin.nic.in/the_ministry/dept_revenue/index.html
Department of Disinvestment
Block 11 & 14, CGO Complex, Lodhi Road, New Delhi 110003
Phone : 24368528, 24368523, 24368044
Website: http://www.divest.nic.in
Department of FinanciaI Services
Jeevan Deep Building, Parliament Street, New Delhi 110001
Phone : 23748721, 23748734
Website: http://www.finmin.nic.in/the-_ministry/dept_fin_services/fin_services.asp
ltloteJ lo 8oJqet ltess, Mlolstty of lloooce, uepottmeot of cooomlc Affolts, New uelbl.
Introduction
v
Region ActuaI Long ActuaI
(mm) Period % of
Average LPA
(LPA) (mm)
All-India 819.8 887.5 92
Northwest India 569.3 615.0 93
Central India 935.5 975.5 96
Peninsular India 643.9 715.5 90
Northeast India 1275.3 1438.3 93
The Ministry comprises of the five Departments
namely:
Department of Economic Affairs
Department of Expenditure
Department of Revenue
Department of Disinvestment and
Department of Financial Services
1. Department of Economic Affairs
Economic Growth
As per the latest information (Advance Estimates)
of National Income for 2012-2013 (at constant 2004-2005
prices), released by the Central Statistics Office, the
growth of Gross Domestic Product (GDP) at factor cost
is estimated at 5.0 percent in 2012-2013, with agriculture
& allied activities growing at 1.8 per cent, industry at
3.1 per cent and servi ces at 6.6 per cent. The
corresponding growth in GDP in 2011-2012 was 6.2 per
cent, with agriculture and allied sector, industry and
services growing at 3.6, 3.5 and 8.2 per cent, respectively.
The latest information on quarterly estimates of GDP
is available for the first two quarters of 2012-2013.
The GDP growth in the first and second quarters of
2012-2013 is estimated at 5.5 per cent and 5.3 per cent,
as compared to 8.0 per cent and 6.7 per cent during the
corresponding periods of 2011-2012.
Data on the saving and investment is available up
to 2011-2012. The saving rate as percentage of GDP at
current market prices was estimated to be 30.8 per cent
in 2011-2012 as compared to 34.0 per cent in 2010-2011,
while gross domestic capital formation was 35.0 per cent
in 2011-2012 as compared to 36.8 per cent in 2010-2011.
AgricuIture
As per the fourth advance estimates for 2011-12,
foodgrains production was estimated at 257.44 million
tonnes, out of which Kharif production was 129.94 million
tonnes and Rabi production was 127.50 million tons.
During the South West monsoon season of 2012,
the country as a whole received 8 per cent less rainfall
than the Long Period Average (LPA). Central India and
North-west India experienced deficiency level of (-) 4 and
(-) 7 percent, respectively and the Peninsular India
received (-) 10 percent less rainfall. North East India
received 11 percent less rainfall than LPA. At district level
10 percent of districts received excess rainfall 48 percent
normal rainfall 37 percent deficient rainfall and 5 percent
scanty rainfall. Southwest monsoon (June to September
2012) rainfall for the country as a whole and the four broad
geographical regions is given in the table below:
Introduction
Out of 36 Sub Divisions, 13 recorded deficient rainfall
during the South West monsoon in 2012. Out of the
23 remaining sub divisions 1 recorded excess rainfall and
the remaining 22 recorded normal. Out of 628 Metrological
districts for which data are available 365 (58%) received
excess/normal rainfall and the remaining 263 (42%)
received deficient/scanty rainfall during the season
There has been a decline in the overall area
coverage of foodgrai ns duri ng khari f 2012-13 as
compared to kharif 2011-12 (4
th
advance estimates) due
to deficient south west monsoon. The area coverage
under food grains during kharif 2012-13 stood at 665.03
lakh hectares compared to 720.86 lakh hectares last year.
The major decline in the area of kharif foodgrains has
been due to shortfall in the area under rice in Andhra
Pradesh, West Bengal, Jharkhand and Bihar, coarse
cereals mainly due to lower coverage under bajra in
Rajasthan; and also pulses. The area under oil seeds
has also been lower as compared to the previous year.
The area coverage under kharif rice during 2012-13 is
around 391.62 lakh hectares which is lower by 9.06 lakh
hectares compared to last year. The area coverage under
sugarcane during the current year has marginally
improved to 51 lakh hectares, which is higher by about
0.13 lakh hectares as compared to the previous year and
the area under cotton has decreased to116.14 lakh
hectares as compared to 121.78 lakh hectares during
2010-11 registering a decrease of 5.64 lakh hectares.
As per the 1st Advance Estimates (covering only
kharif crops), production of foodgrains during 2012-13 is
estimated at 117.18 million tonnes. Oilseeds production
stood at 18.78 million tonnes, sugarcane at 335.33 million
tons and cotton at 33.4 million bales of 170 kg each.
These production estimates are at lower levels compared
to last year primarily due to deficient south west monsoon
in 2012 and resultant acreage losses.
Industry
During 2012-2013(April-December), as per the
Index of Industrial Production(IIP), the industrial sector
grew at 0.7 per cent as compared to 3.7 per cent growth
AnnuaI Report 2012-2013
vi
during the previous year. Out of the three broad sectors,
the electricity sector has recorded the highest growth. In
the manufacturing sector, the growth have been lower
and in mining sector the growth was negative. During
2012- 2013(April-December), the electricity sector grew
at 4.6 per cent as compared to 9.4 per cent during the
same period of the previous year. The manufacturing and
mining sectors grew at the rates of 0.7 per cent and
(-) 1.9 per cent against the corresponding figures of
4.0 percent and (-)2.6 per cent respectively.
Growth of IIP in December, 2012 (per cent) Base 2004-05 =100
Industry Group Weight December December ApriI-December
2011 2012 2011-12 2012-13
Mining 141.57 -3.3 -4.0 -2.6 -1.9
Manufacturing 755.27 2.8 -0.7 4.0 0.7
Electricity 103.16 9.1 5.2 9.4 4.6
Growth by use-based industriaI group
Basic Goods 456.82 5.5 2.6 6.3 2.7
Capital Goods 88.25 -16.0 -0.9 -2.9 -10.1
Intermediate Goods 156.86 -1.5 -0.1 -0.7 1.6
Consumer Goods 298.08 10.1 -4.2 5.7 2.6
Durables 84.60 5.1 -8.2 5.1 3.7
Non-durables 213.47 13.8 -1.4 6.1 1.7
GeneraI Index 1000 2.7 -0.6 3.7 0.7
Among the use-based i ndustry groups only
intermediate goods sector recorded marginal increase in
growth during 2012-13(April- December) and the basic
goods and consumer goods(durables & non-durables)
showed decline in growth as compared to previous year.
The capital goods sector recorded negative growth during
the same period. The intermediate goods sector showed a
growth of 1.6 per cent during 2012-13(April- December) as
compared to the corresponding figure of (-) 0.7 percent
during 2011-12(April-December). In basic goods sector, the
growth rate for the current year is 2.7 per cent as against
6.3 per cent last year. In consumer goods sector, the growth
in 2012-13(April-December) was 2.6 per cent as against
5.7 per cent in corresponding period of last year. In consumer
durabl es sector, the growth rate has decli ned to
3.7 per cent during 2012-13(April-December) as compared
to 5.1 per cent in 2011-12(April-December). In consumer
non-durables sector, the growth rate has decreased to 1.7
per cent in 2012-13(April-December) as against 6.1 per cent
in 2011-12(April-December). At the disaggregated level, 11
out of the 22 two-digit industrial groups viz. tobacco products,
wearing apparel, wood products, fabricated metal products,
machinery & equipment, accounting and computing
machinery, electrical machinery, medical and optical
instruments, motor vehicles, other transport equipments and
furniture manufacturing recorded negative growth during
2012-13(April-December). Out of the remaining 11 industry
groups, four groups recorded growth rates between 5 to 10
per cent and seven industry groups namely food products,
paper products, publishing & printing, chemical products,
rubber & plastics, other non-metallic mineral products and
basic metals recorded growth rates below 5 per cent.
Infrastructure
The index for eight core industries (comprising crude
oil, petroleum refinery products, coal, electricity, cement,
finished carbon steel, natural gas and fertilizers with a
combined weight of 37.90 per cent in the Index of Industrial
Production) grew by 3.3 per cent during 2012-13
(April- December) as compared to growth rate of 4.8 per cent
achieved during the corresponding period of 2011-12. Two
out of the eight core sectors namely steel and electricity
sectors recorded lower rates of growth of 3.6 percent and
4.6 percent respectively during 2012-13(April-December)
as compared to 9.1 per cent and 9.3 percent during
2011-12(April- December). The growth in coal, refinery
products and cement was 5.7 per cent, 6.9 per cent and
6.1 per cent respectively during 2012-13(April-December)
and in crude oil, natural gas and fertilizers sectors, the
growth was negative during the same period.
Prices and InfIation
The headline inflation measured in terms of
Wholesale Price Index (WPI) averaged 9.56 per cent in
2010-11 and decelerated to 8.94 per cent in 2011-2012
and 7.46 per cent in the first 10 months of 2012-13
(Apr-Jan). In January 2013, inflation was placed at a
38 month low of 6.62 per cent.
The level of inflation and its movement across three
major commodity groups varied significantly. Primary
articles having a weight of 20.12 per cent in WPI recorded
year-on-year inflation of 10.31 per cent in January 2013
as compared to inflation of 2.76 per cent in the same month
last year. Fuel & power having weight of 14.91 per cent in
Introduction
vii
key drivers of food inflation have continued to be the
elevated level of prices for protein foods comprising
animal products, pulses and vegetables. In recent
months, however, price pressures have also been felt
for cereals particularly wheat and rice.
Government has been conscious of the need for
containing inflation. Besides the fiscal and administrative
measures, for protecting vulnerable sections of society
from inflation, issue price for wheat and rice under
targeted public distribution system has been kept
unchanged since July, 2002. At the current level of
economic cost, the issue price for BPL families is only
23.4 per cent and 22.8 per cent for rice and wheat
respectively. Government has also been absorbing a
significant part of cost of diesel, kerosene and LPG by
keeping the pass through to consumer to a reasonable
level. Commodity specific fiscal and administrative
measures (maintain adequate availability) have been
taken to contain profiteering/ exploitation of consumers.
The Reserve Bank of India (RBI) had earlier raised
the policy rates by 375 basis points (bps) from March
2010 to October 2011 to contain inflation which had
persisted at 9-10 per cent level. With some moderation
in inflation, particularly core inflation, RBI began softening
its monetary policy stance gradually to improve growth.
Moderati ng i nf lati on and contai ning i nfl ati onary
expectation, however, remains core of the monetary
policy.
Monetary Trends and DeveIopments during
2012-13
The monetary policy stance continued to focus on
achieving the twin objectives of containing inflation and
facilitating growth. The mounting inflationary pressures
during 2010-2012 required adoption of a tight monetary
policy by the Reserve Bank of India (RBI). Between January
TabIe 1 Year-on-Year infIation trend in Iast two years for major groups of WPI (%)
AII Primary FueI & Manufactured Food Non-food
Commodities ArticIes Power Products index Manufactured
Weight% 100.00 20.12 14.91 64.97 24.31 55.00

April 9.74 7.50 15.09 9.55 13.04 12.10 6.80 5.27 8.95 9.31 6.97 5.06
May 9.56 7.55 12.92 10.31 12.32 11.53 7.43 5.24 8.11 8.91 7.34 5.13
June 9.51 7.58 11.31 9.75 12.85 12.07 7.90 5.37 8.04 9.14 7.73 5.26
July 9.36 7.52 11.47 10.54 12.04 8.39 7.73 5.87 8.17 9.05 7.65 5.65
August 9.78 8.01 12.46 11.23 12.91 8.74 7.87 6.36 9.19 9.32 7.77 5.77
Septembe 10.00 8.07 12.22 9.22 14.02 12.00 8.00 6.47 9.06 8.84 7.99 5.71
October 9.87 7.32 10.96 7.81 14.79 11.65 8.05 5.95 9.29 7.79 8.13 5.17
November 9.46 7.24 8.90 9.56 15.48 9.97 8.17 5.41 7.94 8.96 8.35 4.65
December 7.74 7.18 3.59 10.61 14.98 9.38 7.64 5.04 2.70 10.39 7.91 4.24
January 7.23 6.62 2.76 10.31 16.99 7.06 6.71 4.81 1.45 10.57 6.96 4.12
February 7.56 - 7.07 - 15.11 - 5.82 - 5.93 - 5.87 -
March 7.69 - 10.41 - 12.82 - 5.16 - 8.70 - 4.96 -
Average 8.94 7.46 9.80 9.88 13.96 10.25 7.26 5.58 7.24 9.22 7.29 5.07
Note: The figures for Dec-12 and Jan-13 are provisional.
WPI recorded year-on-year inflation of 7.06 per cent in
January 2013 as compared to 16.99 per cent in the same
month last year. Manufactured products, having weight
of 64.97 per cent in WPI recorded an inflation of
4.81 per cent in January 2013 as compared to an inflation
of 6.71 per cent in the same month last year.
The food inflation comprising primary food articles
and manufactured food products (weight of 24.31 per cent
in WPI) at 10.57 per cent in January 2013 was significantly
higher as compared to an inflation of 1.45 per cent in
January 2012.
The core inflation which corresponds to inflation for
non-food manufactured products and keenly observed
by the Reserve Bank of India moderated from its peak of
8.50 per cent in March 2011 to 4.12 per cent in January
2013. Apart from monetary measures taken by the
Reserve Bank of India, softening of international and
domestic prices of metals, chemicals and textile products
contributed to the moderation of this inflation.
Year-on-year inflation measured in terms of
Consumer Price Index for Industrial Workers (CPI-IW
2001=100) was 11.17 per cent in December 2012 as
compared to 6.49 per cent in December 2011. Food
inflation (weight 46.20%) was 13.53 per cent in December
2012 had in fact witnessed an increase compared to an
inflation of 1.97 per cent in December 2011. In case of
Consumer Price Index-New Series with base 2010=100,
inflation in January 2013 for rural, urban and at all-India
level was placed at 10.88 per cent, 10.73 per cent and
10.79 per cent, respectively.
Food inflation which ruled at 14 to 16 per cent level
for different measures of inflation in April 2010 had earlier
moderated to around 1 per cent in January 2012, but has
been witnessing a continuous increase since then. The
AnnuaI Report 2012-2013
viii
2010 and October 2011 RBI raised policy rates (repo rates)
by 375 basis points from 4.75 per cent to 8.5 per cent. The
tight monetary policy in the face of a persistent inflation
together with the increasing risk to growth from external
factors resulted in a slowdown of the economy, faster than
was anticipated earlier. With a moderation in inflation from
its peak to 10.9 per cent in April, 2010 to an average of
7.5 per cent during April-January, 2012-13, there was a
shift in the policy stance of RBI from October, 2011. RBI
reduced the repo rates by 50 basis points in April, 2012
and by 25 basis poi nts agai n i n January, 2013.
Simultaneously, it continued to reduce the Cash Reserve
Ratio from 6 per cent to 4 per cent and the statutory liquidity
ratio to improve the liquidity conditions.
The monetary policy stance of the Reserve Bank of
India in 2012-13 was based on its projection of the
macroeconomic parameters for the year. In its monetary
policy statement 2012-13 released on April, 17, 2012 RBI
envisaged a GDP growth of 7.3 per cent with inflation
(WPI headline) gradually moderating to 6.5 per cent by
March, 2013. Consistent with this growth and inflation
expectations, it set an indicative target of M3 and non-
food credit growth of 15 per cent and 17 per cent
respectively. RBI, however, continued to revise its growth
projections downwards and in its 3rd quarter review of
monetary policy in January 2013, it reduced its projection
of growth to 5.5 per cent. However, with regard to headline
WPI inflation, the 3rd Quarter Review indicated inflation
to moderate to 6.8 per cent by March 13. In view of the
revision in the projections for GDP growth and inflation,
the indicative targets of growth of credit and M3 were
lower to 16 per cent and 13 per cent, respectively.
Movement of monetary aggregates, however, indicate
that the growth of both the broad money and non-food
credit were below the indicative levels set by RBI.
During 2012-13, the growth rate in Reserve Money
(MO) has been 4.4 per cent (as on January 25, 2013),
while broad money (M3) growth has been 10.2 per cent
(as on January 11, 2013). Year-on-year, non-food credit
growth increased by 15.7 per cent (as on January 11,
2013). Liquidity conditions tightened from the second
week of November on account of a build-up in the
Centres cash balances, festival-related lumpy increase
in currency demand, and structural pressures brought
on by the widening wedge between deposit growth and
credit growth. With the liquidity deficit continuing to remain
above the comfort level of RBI, it took measures by way
of reducing the CRR and conducting open market
operations to ease the pressures.
BaIance of Payments during H1
(ApriI-September 2012) of 2012-13
In the first Half (H1-April-September 2012) of
2012-13, steep decline in exports as compared to imports
was responsible for widening of trade deficit to US$ 90.7
billion (10.8 per cent of GDP) vis--vis US$ 89.5 billion
(9.9 per cent of GDP) in H1 of 2011-12. Net invisible
balance declined to US$ 51.7 billion (6.2 per cent of GDP)
during H1 of 2012-13 from US$ 53.1 billion (5.9 per cent
of GDP) in H1 of 2011-12. The current account deficit
(CAD) has worsened to US$ 39.0 billion (4.6 per cent of
GDP) during H1 of 2012-13 as compared to US$ 36.4
billion (4.0 per cent of GDP) in H1 of 2011-12. Widening
of trade deficit and moderation in net invisible surplus
were responsible for increase in CAD.
There was a mixed trend in the capital inflows during
first half of 2012-13. The net FDI (inward minus outward)
to India decreased to US$ 12.8 billion during first half of
2012-13 vi s-a-vi s US$ 15.7 bi l l i on duri ng the
corresponding period of previous year. Net portfolio flows
including FIIs, however, increased to US$ 5.8 billion
during H1 of 2012-13 as against US$ 1.3 billion in H1 of
2011-12. NRI deposits remained robust at US$ 9.4 billion
in H1 of 2012-13 (US$ 3.9 billion in H1 of 2011-12) but
net flows under ECBs declined sharply to US$ 1.7 billion
during H1 of 2012-13 from US$ 8.4 billion in H1 of
2011-12. Net flows under trade credit increased to
US$ 9.5 billion during April-September 2012 as against
US$ 5.9 billion during the corresponding period of
2011-12. Net capital flows declined to US$ 40.0 billion
(4.8 per cent of GDP) in H1 of 2012-13 as against
US$ 43.5 billion (4.8 per cent of GDP) in H1 of 2011-12.
As the capital inflows during the first half of
2012-13 were sufficient to finance the current account
deficit, there was a net accretion of US$ 0.4 billion to
reserves (on a BoP basis) during H1 of 2012-13.
TabIe: BaIance of Payments Summary (US$ miIIion)
SI. No. Item 2011-12 2012-13
(H1-ApriI- (H1-ApriI-
September) September)
(PR) (P)
I Current Account
1 Exports 158,202 146,549
2 Imports 247,739 237,221
3 Trade Balance -89,537 -90,672
4 Invisibles (net) 53,103 51,699
5 Current Account Balance -36,433 -38,973
II CapitaI Account
1 FDI (net) 15,741 12,812
2 Portfolio (net) 1,345 5,796
3 External Assistance (net) 640 15
4 External Commercial 8,388 1,726
Borrowings (net)
5 Short-term debt 5,940 9,511
6 Banking Capital (net)] 19,713 14,899
7 Other Flows (net) -8,278 -4,769
8 Capital Account Balance 43,490 39,989
III Errors and Omissions -1,338 -653
IV OveraII BaIance 5,719 363
V Reserves change -5719 -363
(Increase(-)/Decrease (+))
Source: Reserve Bank of India. P: Preliminary, PR: Partially Revised
Note: Totals may not tally due to rounding off.
Introduction
ix
Foreign Exchange Reserves
Foreign exchange reserves reached all time high
level of US$ 322.2 billion at end August 2011. However,
reserves declined thereafter and stood at US$ 294.4
billion at end March 2012. This showed a decline of
US$ 10.4 billion from the level of US$ 304.8 billion at end
March 2011.
In 2012-13, the f orei gn exchange reserves
remained in the range of US$ 286.0 billion to US$ 295.6
billion. At end December 2012, reserves stood at 295.6
billion, indicating a marginal increase of US$ 1.2 billion
from US$ 294.4 billion at end March 2012.
Exchange Rate
The monthly average exchange rate value of
rupee per US dollar remained in the range between
Rs. 51.81 to Rs. 56.03 per US dollar with many ups and
downs between April 2012 to December 2012. Rupee
touched an all time low of Rs. 57.22 per US dollar on
June 27, 2012 indicating 10.6 per cent depreciation over
Rs. 51.16 per US dollar on March 30, 2012. Rupee has
appreciated to Rs. 51.62 per US dollar on October 05,
2012. However, it began declining again thereafter and
monthly average exchange rate of rupee has since been
in range of Rs. 53.02 to Rs. 54.78 per US dollar between
October to December 2012.
On month-to-month basis the rupee depreciated by
7.9 per cent from Rs. 50.32 per US dollar in March 2012
to 54.65 per US dollar in December 2012. Similarly,
monthly average exchange rate of rupee depreciated by
9.7 per cent against pound sterling, 7.2 per cent against
euro and by 6.5 per cent against Japanese yen between
March 2012 and December 2012.
ExternaI Debt
Indias external debt stock stood at US$ 365.3 billion
at end-September 2012 recording an increase of about
US$ 20.0 billion (5.8 per cent) over the end-March 2012
estimates of US$ 345.4 billion. The increase in external
debt was largely due to higher NRI deposits, short-term
debt and commercial borrowings. The long-term external
debt at US$ 280.8 billion at end-September 2012,
accounted for 76.9 per cent of the total external debt while
the remaining 23.1 per cent was short-term debt.
The share of US dollar denominated debt continued
to be the highest in external debt stock at 55.7 per cent
at end-September 2012, followed by Indian rupee
(22.9 per cent), Japanese Yen (8.6 per cent), SDR
(8.1 per cent) and Euro (3.2 per cent). Government
(sovereign) external debt stood at US$ 81.5 billion, while
non-Government debt amounted to US$ 283.9 billion at
end-September 2012. The share of Government external
debt in total external debt declined from 25.5 per cent at
end-March 2011 to 23.7 per cent at end-March 2012 and
further to 22.3 per cent at end-September 2012.
Indias foreign exchange reserves provided a cover
of 80.7 per cent to the total external debt stock at
end-September 2012 vi s--vi s 85.2 per cent at
end-March 2012. The ratio of short-term external debt to
foreign exchange reserves was at 28.7 per cent at
end-September 2012 as compared to 26.6 per cent at
end-March 2012. The ratio of concessional debt to total
external debt declined steadily and worked out to
13.2 per cent at end-September 2012 as against
13.9 per cent at end-March 2012.
External debt has remained within manageable
limits as indicated by the external debt to GDP ratio of
19.7 per cent and debt service ratio of 6.0 per cent in
2011-12 due to the prudent external debt management
policy pursued by the Government of India.
Merchandise Trade
Indias merchandise trade increased exponentially
in the 2000s decade from US$ 94.1 billion in 2000-1 to
US$ 620.9 billion in 2010-11 and further to US$ 793.8
billion in 2011-12. Indias share in global exports and
imports also increased from 0.7 per cent and 0.8 per cent
respectively in 2000 to 1.7 per cent and 2.5 per cent in
2011. Its ranking in the leading exporters and importers
improved from 31 and 26 in 2000 to 19 and 12 respectively
in 2011.
Whi l e Indi as total merchandi se trade as a
percentage of the gross domestic product (GDP)
increased from 29.5 per cent in 2004-05 to 46.2 per cent
i n 2011-12 as per provi si onal esti mates, Indi as
merchandise exports as a percentage of GDP increased
from 12.6 per cent to 17.7 per cent during the same
period.
TabIe: Exchange Rates of Rupee per Foreign Currency
MonthIy average exchange rates *
Month US Pound Euro Japanese
doIIar sterIing yen**
March 2012 50.3213 79.6549 66.4807 61.0259
April 2012 51.8121 82.9119 68.1872 63.7934
May 2012 54.4736 86.7323 69.6991 68.3286
June 2012 56.0302 87.1349 70.3087 70.6743
July 2012 55.4948 86.5173 68.2520 70.2809
August 2012 55.5594 87.3444 68.8750 70.6814
September 2012 54.6055 87.8663 70.1263 69.9084
October 2012 53.0239 85.2128 68.7522 67.2305
November 2012 54.7758 87.5374 70.3665 67.6032
December 2012 54.6478 88.1910 71.6671 65.2805
Source : Reserve Bank of India.
*: FEDAI market indicative Rates. Data from May2012 onwards
are RBIs reference rates. **: Per 100 Yen.