Mumbai: India’s foreign exchange reserves crossed the $200-billion milestone, enough to meet imports for more than a year — a far cry from the days in 1990 when the country had to pledge gold to buy foreign goods.
Forex reserves, made up mainly of capital and other inflows such as remittances by NRIs, increased by $1.141 billion to $200.325 billion during the week ended 6 April as against $199.179 billion in the previous week.
Foreign currency assets (FCAs) rose by $1.151 billion to $193.075 billion, as per figures released by the Reserve Bank of India here on 13 April.
Special drawing rights (SDRs) and gold reserves remained static at $2 million and $6.784 billion, respectively. The reserve position in the IMF stood at $469 million.
The country’s merchandise imports during April-February this fiscal stood at $165 billion, and as per this estimate the forex reserve is enough to meet 14-16 months of import requirements.
In contrast, India was left with barely $1 billion of reserves in December 1990, which was insufficient for meeting imports of even two weeks, and had to pledge gold abroad to raise resources.
Today, India has the sixth largest forex reserves in the world, after China, Japan, Russia, Taiwan and Korea.
China has reserves of $1.2 trillion, Japan $909 billion, Russia $338 billion, Taiwan $267 billion and Korea $243 billion. Seventh-ranked Singapore holds reserves of $137 billion, followed by Hong Kong at $135 billion.
Forex reserves have doubled from $100 billion in December 2003. In fact, $48 billion have been added to the kitty in the last one year alone due to strong capital flows.