India's management of foreign exchange reserves has generally been in accordance with International Monetary Fund guidelines and comparable to global best practices.
After a long debate with Planning Commission, Finance Minister P Chidambaram has finally agreed to consider funding infrastructure projects through the country's booming foreign exchange reserves that currently stand at about $170 billion.
The Reserve Bank of India has brought 100 metric tonnes of gold reserve from the UK to India as there is enough domestic storage capacity, and nothing more should be read into it, Governor Shaktikanta Das said on Friday. The RBI moved 100 metric tonnes of its gold stored in the UK to domestic vaults in FY24.
Benchmark stock indices Sensex and Nifty rebounded on Thursday after two days of decline, mirroring a rally in global markets as a US court blocked President Donald Trump's reciprocal tariffs. The 30-share BSE Sensex climbed 320.70 points or 0.39 per cent to settle at 81,633.02.
India's exports in April jumped nearly three-fold to USD 30.63 billion from USD 10.36 billion in the same month last year, according to government data released on Friday.
'India's sizeable foreign exchange reserves should serve as a buffer.'
Contradicting the International Monetary Fund, which does not want India and other countries to use any of its foreign exchange reserves for building infrastructure
'Growth, liquidity and deposit mobilisation are likely to be discussed during the interaction.'
The first national flag in Independent India was hoisted at Fort St George in Madras, not at Delhi's Red Fort.
A pregnant Sri Lankan woman, who had been in a queue for two days to obtain a passport to leave the crisis-hit country for employment overseas, went into labour while waiting for her turn on Thursday and delivered a baby girl.
Government is also will also enter into an agreement with Japan for a $50 billion swap.
Among Sensex firms, Eternal, Tata Motors, State Bank of India, Adani Ports, NTPC, IndusInd Bank, Bajaj Finance, Asian Paints, Axis Bank and Sun Pharma were the major losers. Bharti Airtel, Tata Steel, Mahindra & Mahindra, Hindustan Unilever, Nestle and Maruti were among the gainers.
'We remain in touch with the Chinese side, in Beijing as well as in Delhi, to bring predictability in the supply chain.'
From the Sensex pack, Bharti Airtel, Titan, Tata Consultancy Services, Hindustan Unilever, Infosys, Nestle, Reliance Industries, Mahindra & Mahindra, HDFC Bank and Tata Motors were the biggest gainers. However, IndusInd Bank, Bajaj Finance and UltraTech Cement were the laggards.
The surge is a stark turnaround from 2013 when the country's current account gap hit a record high due to outflows on expectations the US Fed would rein in its stimulus programme
The central bank had in July last year imposed curbs such as doubling of margin requirement and a ceiling on position limits on exchange-traded currency derivatives.
India's large foreign exchange reserves can cushion a short-term jump in oil prices, but a long drawn conflict in Iraq could hurt the economy
With the prediction of an above normal monsoon in 2024, the government is expecting food prices to come down, the finance ministry's monthly economic report for March has said. The report, released on Thursday, said robust foreign inflows and comfortable trade deficits were expected to keep the rupee within a comfortable range. "Further easing of food prices is on the anvil as IMD (India Meteorological Department) has predicted above-normal rainfall during the monsoon season, which is likely to lead to higher production, assuming good spatial and temporal distribution of the rainfall," the monthly report, released by the Department of Economic Affairs, said.
The Indian rupee is expected to trade between 80 and 84 against dollar in the first three months of 2023 with support from overseas inflows though worsening current account deficit (CAD) and reduced interest rate differential between the US and India pose challenges. According to a Business Standard Poll of 10 participants, most said the rupee could gain strength in January due to foreign inflows, and the Reserve Bank of India (RBI) is not expected to allow the currency to depreciate ahead of the Union Budget scheduled on February 1. The rupee depreciated 10.15 per cent in 2022, its worst performance since 2013 as the war in Europe and the interest rate increase by the US Federal Reserve prompted investors to flee emerging markets.
With huge accumulated foreign exchange reserves at their disposal, developing countries, mainly India, China, Russia, Brazil and Mexico, are giving invaluable reverse aid to the United States, although it is not counted as aid.
Speaking in the Rajya Sabha on the precarious condition of state finances, Congress leader Manmohan Singh on Tuesday said the state finances were in dismal shape.
If net forex outflows turn out to be relatively high in the next few years, the rupee could depreciate beyond Rs 80 to a dollar by 2022. The causal reasons could, for example, include unmet expectations of FPI and FDI investors about the performance of the Indian economy, sharp rise in prices of imported oil and decrease in FX remittances. The RBI has to ask itself whether guaranteeing future rupee-dollar exchange rates on FX forward contracts is a reasonable way to use its risk-bearing capacity, says Jaimini Bhagwati.
India's foreign exchange reserves surged $5.04 billion in the week ending March 28, its biggest weekly rise in four months, as the central bank started to buy dollars regularly in an effort to build up its defences against any potential global turmoil.
The government on Monday ruled out making public the RBI report detailing the reasons why the central bank could not keep inflation within the targeted 6 per cent upper limit for the three consecutive quarters. "Yes sir, RBI has furnished a report to the central government, as mandated under Section 45ZN of the RBI Act, 1934 and Regulation 7 of RBI Monetary Policy Committee and Monetary Policy process Regulations, 2016," minister of state for finance Pankaj Chaudhary said in a written reply. The said provisions of the RBI Act, 1934, and regulations therein does not provide for making the report public, he said.
Based on the current momentum, the funds likely to be raised through the RBI's relaxed window would be $3.5 billion-$4 billion.
According to sources, the central bank is keen on such a scheme to attract foreign exchange, as the country's reserves have seen a depletion in the wake of a weakening domestic currency.
Raghuram Rajan has described the fall in reserves as dip in valuation with appreciation of dollar against other currencies
Recently, Prime Minister Manmohan Singh had also ruled out the possibility of India witnessing a repeat of the 1991 balance of payments crisis and reversing the path to globalisation of economy.
The 17 rare earth elements that are at the centre of the current crisis are critical components of everyday products -- from cars to jet engines to electronics like smartphones and flat-screen TVs.
Warning commerical banks about credit risks from unhedged foreign exchange positions of corporates and importers, Reserve Bank of India on Monday said accumulation of foreign exchange reserves remained a "matter of concern" for monetary and exchange
India's current account deficit (CAD) may dip further in the March quarter of FY24 as pressure from the negative net exports during the January-March period eased to an 11-quarter high. A part of the gross domestic product (GDP) data, net export- which is usually negative for India - captures the difference between exports and imports of both goods and services, while the CAD data, released by the Reserve Bank of India (RBI), also factors in private transfer receipts.
'The RBI's MPC will maintain the current policy rates (6.50%) at the policy meeting, given ongoing inflationary pressures.'
In July, the Pakistan government's debt swelled to USD 2.44 billion, including USD 2.07 billion in non-guaranteed debt owed to China, as per Geo News.
From the Sensex firms, Tata Steel, Eternal, Tech Mahindra, Maruti, Mahindra & Mahindra, Infosys, IndusInd Bank, HCL Tech, Tata Consultancy Services and Bharti Airtel were the major gainers. Telecom operator Bharti Airtel climbed nearly 1 per cent after it posted about a five-fold jump in consolidated net profit to Rs 11,022 crore in the March 2025 quarter, mainly due to the tariff hike impact and one-time gain on tax benefits. However, Asian Paints, Tata Motors, Kotak Mahindra Bank, NTPC and Power Grid were among the laggards.
The government is planning to introduce legislative changes to the Foreign Exchange Management Act (Fema) regulations, with a focus on easing the pathway for inflows from a foreign portfolio investor to transition seamlessly into foreign direct investments (FDI) once the FPI surpasses the 10 per cent ownership threshold in a company. This move stems from multiple requests by foreign investors seeking to streamline the reporting requirements that arise when their stakes in Indian firms cross the 10 per cent mark.
Among Sensex scrips, Bharti Airtel, Titan, NTPC, State Bank of India, ITC, Tata Steel, Mahindra & Mahindra and Tata Motors were the major laggards. Adani Ports, Infosys, Axis Bank, HCL Technologies, Tech Mahindra and IndusInd Bank were among the gainers.
The Reserve Bank of India (RBI) is expected to cut interest rates for the first time in nearly five years in Governor Sanjay Malhotra's first monetary policy committee (MPC) meeting on Wednesday. The meeting of the six-member MPC, which will culminate on Friday, aims to boost sluggish economic growth, which is seen falling to a four-year low. Malhotra took charge as the 26th RBI governor in December last year.
