Business Today
Loading...

India fourth largest forex holder in world, exceeds Russia

India pulled ahead as Russian holdings declined at a faster rate in recent weeks as the Reserve Bank of India (RBI) continues to hoard dollars to cushion the economy against any sudden outflows

twitter-logoBusinessToday.In | March 15, 2021 | Updated 01:11 IST
India fourth largest forex holder in world, exceeds Russia
Representative Image

India's foreign-exchange reserves have become the fourth largest in the world, surpassing Russia. China has the largest foreign currency reserves followed by Japan and Switzerland.

India's foreign currency holdings, which dropped $4.3 billion to $580.3 billion on March 5 as per the Reserve Bank of India (RBI), surpassed Russia's $580.1 billion, says a Bloomberg report.

India pulled ahead as Russian holdings declined at a faster rate in recent weeks as RBI continues to hoard dollars to cushion the economy against any sudden outflows.

India's foreign-exchange reserves, which is sufficient to cover around 18 months of imports, have been boosted by current-account surplus, rising inflows into the foreign direct investments and the domestic stock market.

Kaushik Das, chief India economist at Deutsche Bank, before the latest data was released, said: "India's various reserves adequacy metrics have improved significantly, particularly in the last few years."

According to the experts, a strong reserves position gives credit rating companies and foreign investors added comfort that the country's government can meet its debt obligations despite a declining fiscal outlook.

The RBI bought a net of $88 billion in the spot forex market in 2020, which helped make the rupee the worst performer among Asia's major currencies and earned a place on a US Treasury watchlist for currency manipulation.

Also Read: 'Drastic changes' in monetary policy framework can upset bond market, warns Raghuram Rajan

Also Read: Centre plans to sell remaining stake in Delhi, Mumbai, Bengaluru, Hyderabad airports

Also Read: FPIs pull out Rs 7,013 crore from India in March 2021

  • Print
  • COMMENT
BT-Story-Page-B.gif
A    A   A
close