India surpasses Russia as world’s 4th biggest forex reserve holder

Dubai - China has the world’s largest reserves, followed by Japan and Switzerland on the IMF table.

India has surpassed Russia to emerge as the world’s fourth-largest foreign-exchange reserve holder.

China has the world’s largest reserves, followed by Japan and Switzerland on the International Monetary Fund table.

Also read:

India to propose cryptocurrency ban, penalising miners, traders

Forex reserves for both India and Russia have mostly flattened out this year after months of rapid increase. India pulled ahead as Russian holdings declined at a faster rate in recent weeks as the Reserve Bank of India continued to hoard dollars to cushion the economy against any sudden outflows.

Despite a recent fall of $4.3 billion to $580.3 billion as of March 5 due to a decline in the Foreign Currency Assets (FCA), the south Asian nation’s forex holdings claimed the fourth ranking as Russia’s reserves fell at a steeper pace to $580.1 billion.

India’s reserves, enough to cover roughly 18 months of imports, have been bolstered by a rare current-account surplus, rising inflows into the local stock market and foreign direct investment. It touched a record high of $590.185 billion in the week ended January 29, 2021, according to RBI data.

A strong reserves position gives foreign investors and credit rating companies added comfort that the government can meet its debt obligations despite a deteriorating fiscal outlook and the economy heading for its first full-year contraction in more than four decades, analysts said.