India’s foreign exchange reserves rose by $1.594 billion to touch a lifetime high of $372.73 billion in the week to April 28, supported by an increase in foreign currency assets.
The reserves had risen by $1.250 billion to $371.14 billion in the previous week.
Previously, they had touched a high of $371.99 billion in the week to September 30, 2016.
Gold reserves remained unchanged at $19.869 billion.
The Foreign exchange reserves of India consists of below four categories:
1. Foreign Currency Assets
2. Gold
3. Special Drawing Rights (SDRs)
4. Reserve Tranche Position in the IMF
The Foreign exchange reserves of India are India’s holdings of cash, bank deposits, bonds, and other financial assets denominated in currencies other than India’s national currency, the Indian rupee.
The reserves are managed by the Reserve Bank of India for the Indian government and the main component is foreign currency assets.
Foreign exchange reserves act as the first line of defense for India in case of economic slowdown, but acquisition of reserves has its own costs.
Foreign exchange reserves facilitate external trade and payment and promote orderly development and maintenance of foreign exchange market in India.
