India cuts US debt holding to $38.9 bn in July

India cuts US debt holding to $38.9 bn in July

India's holding of US treasury securities marginally declined to USD 38.9 billion in July as compared to USD 39.3 billion in June. Going by the data available with the US Treasury Department, India has decreased its investment in such securities for the first time since October 2008, when the same stood at USD 18.3 billion. In September last year, when the collapse of then Wall Street titan Lehman Brothers pushed the global financial system into a tizzy, India's investment in US treasury securities had touched USD 20.3 billion.

On the other hand, neighbouring China continues to remain the largest foreign holder of these securities, with their investment reaching a whopping USD 800.5 billion in July.
Interestingly, China has hiked its investment that month from USD 776.4 billion in June. Except China, rest of the BRIC nations brought down their holding of US treasury securities in July.

Brazil cut its investment to USD 138.1 billion as compared to USD 139.8 billion in June while Russia decreased the same to USD 118 billion from USD 119.9 billion in the previous month.

After China, the largest foreign holder of US debt is Japan. The Asian economic giant invested USD 724.5 billion in these securities in July. For the financial year ended September 30, America's budget deficit touched USD 1.4 trillion, accounting for 9.9 per cent of the national GDP.

The recession-hit has been grappling with one of the worst financial turmoils in decades, forcing the Federal government to come up with unprecedented measures to revive the country's economy.