Business Meridian
India’s foreign-exchange reserves rose by $10.512 billion in the week ending July 31 to reach $692.866 billion, the Reserve Bank of India reported. It was the second consecutive week of significant growth.
Foreign-currency assets, the largest component, increased by $8.75 billion to $564.68 billion. Gold reserves rose by $1.685 billion to $104.743 billion, while special drawing rights reached $18.666 billion and India’s reserve position with the IMF rose to $4.778 billion.
The increase follows a fall after conflict in West Asia put pressure on the rupee and required central-bank intervention. Reserves remain below the February high of $728.494 billion, but the recent recovery strengthens the country’s external buffer.
Government and central-bank measures designed to attract foreign-currency inflows, including FCNR-related steps, have also contributed. Reports put inflows under those measures at about $32 billion.
Strong reserves help pay for imports, service foreign liabilities and moderate exchange-rate shocks. They do not eliminate economic risk, but they give policymakers more room to respond when global markets become volatile.