Another Source of Much-Needed Cash Dries Up for Indian Firms
- India foreign-currency loans set for 11-year low this quarter
- Overseas funding concerns add to cash pressures on companies
Vehicles travel along an empty Marine Drive during a lockdown imposed due to the coronavirus in Mumbai, India, on Monday, June 1.
Photographer: Dhiraj Singh/BloombergThis article is for subscribers only.
A slump in Indian company foreign-currency loans to an 11-year low is raising concerns that weaker borrowers may struggle to refinance a record amount of maturing debt amid the pandemic.
Local firms have secured $1.4 billion from offshore loans since April 1, down from $7.3 billion in the first quarter, according to data compiled by Bloomberg. Their overseas bond issuance has also dropped. The Covid-19 crisis has further crimped options for foreign-currency funding, worsening a credit crunch sparked by the collapse of shadow lender IL&FS in 2018.