India’s foreign exchange reserves surged by $44.90 billion to a record $785.71 billion in the week ended 4 September, marking the largest weekly increase on record.
The Reserve Bank of India released the data on Friday (11 September).
The reserves had climbed by $11.47 billion in the previous week to $740.80 billion as of 28 August.
The surge propelled India ahead of Russia to become the fourth-largest holder of foreign exchange reserves globally, behind only China, Japan and Switzerland.
Foreign currency assets, the largest component of India’s forex reserves, rose by $47.498 billion during the week to $648.17 billion, accounting for the bulk of the overall increase.
Gold reserves declined by $2.594 billion to $113. 816 billion, while the country’s reserve position with the IMF increased by $2 million to $4.916 billion.
The dramatic rise in reserves stems largely from the Reserve Bank’s special foreign currency deposit scheme targeting India’s 35 million-strong diaspora.
The FCNR(B) deposit programme, which launched on 8 June, has attracted $136.377 billion in total inflows as of 31 August, with FCNR(B) deposits alone accounting for $127.226 billion.
The scheme, originally scheduled to close on 30 September, was advanced to 31 August after overwhelming response from non-resident Indians.
Overall, India’s foreign exchange reserves have risen by $94.599 billion since the end of March and are $87.438 billion higher than they were a year ago.
The reserves had been declining earlier this year as the rupee came under pressure following the start of conflict in West Asia, requiring RBI intervention through dollar sales.
The enhanced reserve position provides India with a stronger buffer against external economic shocks and greater capacity to manage volatility in global financial markets and the foreign exchange market.
Please click here to add Swarajya as your preferred and trusted news source on Google
