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Forex reserves of India
June 11 , 2020
1502 days
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- Amid pandemic, India’s foreign exchange reserves are rising and are slated to hit the $500 billion mark soon.
- The level of foreign exchange reserves has steadily increased from $5.8 billion as of March 1991 to the current level.
- The rising reserves have helped the rupee to strengthen against the dollar.
- Forex reserves are external assets in the form of gold, SDRs (special drawing rights of the IMF) and foreign currency assets accumulated by India and controlled by the Reserve Bank of India.
- The foreign currency assets include capital inflows to the capital markets, FDI and external commercial borrowings.
- As much as 64 per cent of the foreign currency reserves is held in the securities like Treasury bills of foreign countries, mainly the US.
- India also held 653.01 tonnes of gold as of March 2020.
- It is held at overseas in safe custody with the Bank of England and the Bank for International Settlements, while the remaining gold is held domestically.
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