India’s foreign exchange reserves cover of imports (on balance of payments basis) increased to 10.2 months as at June-end 2023 from 9.6 months at end-March 2023.

Import cover is a trade-based indicator of adequacy of reserves. This cover improved in sync with rise in forex reserves, which stood at $595.051 billion as at June-end 2023 against $578.449 billion as at March-end 2023.

As at end-September 2023, the Reserve Bank’s gold holding rose to 800.79 tonnes of gold (794.64 tonnes as at March-end 2023), as per RBI’s Half Yearly Report on Management of Foreign Exchange Reserves: April - September 2023.

The gold holding includes gold deposits of 39.89 tonnes (56.32 metric tonnes). The ratio of short-term debt (original maturity) to reserves, which was 22.2 per cent at end-March 2023, decreased to 20.8 per cent at end-June 2023.

The ratio of volatile capital flows (including cumulative portfolio inflows and outstanding short-term debt) to reserves remained at 70.3 per cent between end-March 2023 and end-June 2023.

As at end-September 2023, out of the total foreign currency assets (FCA) of $521.37 billion ($509.691 billion as at March-end 2023), 81.43 per cent invested in securities (80.76 per cent), 13.49 per cent was deposited with other central banks and the BIS (14.82 per cent) and the balance 5.08 per cent comprised deposits with commercial banks overseas (4.42 per cent).

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