India has large foreign-exchange reserves; 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.[1] Foreign exchange reserves facilitate external trade and payment and promote orderly development and maintenance of foreign exchange market in India.[2]

India's total foreign exchange (Forex) reserves stand at around US$573.72 billion on 20 Jan 2023, with the Foreign Currency Assets (FCA) component at around US$506.35 billion, Gold Reserves at around US$43.712 billion, SDRs (Special Drawing Rights with the IMF) of around US$18.43 billion and around US$5.226 billion Reserve Position in the IMF, as per Reserve Bank of India's (RBI) weekly statistical supplement published on 27 Jan 2023.[3] The Economic survey of India 2014-15 said India could target foreign exchange reserves of US$750 billion-US$1 Trillion.[4]

India's foreign exchange reserves are mainly composed of US dollar in the forms of US government bonds and institutional bonds.[5][6] with nearly 7.34% of forex reserves in gold. The FCAs also include investments in US Treasury bonds, bonds of other selected governments and deposits with foreign central and commercial banks. As of September 2021, India holds fourth largest foreign-exchange reserves in the world following Switzerland.[7][8]


Reserve Bank of India Act and the Foreign Exchange Management Act, 1999 set the legal provisions for governing the foreign exchange reserves. Reserve Bank of India accumulates foreign currency reserves by purchasing from authorized dealers in open market operations. Foreign exchange reserves of India act as a cushion against rupee volatility once global interest rates start rising.[9]

The Foreign Exchange Reserves of India consists of below four categories;[10][11]

  1. Foreign Currency Assets - Total FCA till March 2021 was $536.69 billion out of which $359.87 billion is invested in overseas securities, $153.39 billion is deposited with other central banks and $23.42 (4.36 percent of total FCA) billion is deposited with overseas commercial banks.[12]
  2. Gold - As of March 2021 RBI held 695.31 metric tonnes of gold. 403.01 metric tonnes of which is in custody of Bank of England and Bank for International Settlements. 292.30 tonnes of gold is held domestically.[12]
  3. Special Drawing Rights (SDRs)
  4. Reserve Tranche Position


Foreign Exchange Reserves of India
Foreign Exchange Reserves of India

See also

India related
Global lists and other nations


  1. ^ "Costs Involved in Increasing Forex Reserves: RBI".
  2. ^ "RBI".
  3. ^[bare URL PDF]
  4. ^ "RBI Monetary Policy $1 trillion forex reserves: A pipe dream". Business Standard India. 4 April 2015.
  5. ^ "Major foreign holders of treasury securities of USA". Retrieved 22 January 2021.
  6. ^ Y V Reddy: India’s foreign exchange reserves – policy, status and issues – May 10, 2002
  7. ^ a b "Surging forex reserves to help improve economic outlook".
  8. ^ "Look How Rich India's Become Under New Prime Minister Modi". Forbes.
  9. ^ "India's forex reserves will cushion Rupee volatility: Rajan". Archived from the original on 12 August 2014.
  10. ^ "Report on Management of Foreign Exchange Reserves". 8 December 2020. Retrieved 22 January 2021.
  11. ^ "Foreign exchange reserves of india".
  12. ^ a b "Foreign currency asset exposure to overseas lenders, central banks rises". The Indian Express. 13 May 2021. Retrieved 6 October 2021.
  13. ^ a b Forex reserve history
  14. ^ "India flexes its foreign reserve muscles".
  15. ^ Manikandan, Ashwin. "India's Forex Reserves cross half trillion dollars for the first time". The Economic Times. Retrieved 6 October 2021.
  16. ^ "India's Record Forex Pile May Not Be Adequate, RBI Paper Says". 17 June 2021. Retrieved 13 February 2023.
  17. ^ "India's forex kitty crosses $600 billion for the first time". The Economic Times. 11 June 2021. ISSN 0013-0389. Retrieved 13 February 2023.
  18. ^ Nayak, Gayatri. "Forex reserves rise after falling for four weeks". The Economic Times.
  19. ^ "India's forex reserves drop by $1.5 billion to $575.3 billion as on February 3". The Economic Times. 10 February 2023. ISSN 0013-0389. Retrieved 13 February 2023.