India's foreign exchange reserves:

Question

India's foreign exchange reserves:

1. A. Increased to around USD 640 billion as of the end of December 2024 (Correct answer)
2. B. Are seventh largest in the world
3. C. Decreased caused by a BoP deficit of around USD 24 billion in 2024
4. D. More than one of the above

Correct Answer

Option A — Increased to around USD 640 billion as of the end of December 2024

Detailed Solution & Explanation

The correct answer is Increased to around USD 640 billion as of the end of December 2024.

Key Points

• India's foreign exchange reserves stood at approximately USD 640 billion at the end of December 2024, after touching an all-time high of about USD 705 billion in September 2024.
• Forex reserves are maintained by the Reserve Bank of India and comprise four components: foreign currency assets (FCA), which form the largest share, gold reserves, Special Drawing Rights (SDRs) allocated by the IMF, and the Reserve Tranche Position (RTP) with the IMF.
• India ranks among the top four or five countries globally by reserve holdings, behind China, Japan and Switzerland.
• Large reserves provide an import cover of several months and give the RBI room to manage rupee volatility.

Exam Tip

• learn the four components in order of size and remember that reserves are reported in the RBI's Weekly Statistical Supplement.

प्रश्न (हिन्दी में)

भारत का विदेशी मुद्रा भंडार:

1. A. दिसंबर 2024 के अंत तक बढ़कर लगभग 640 बिलियन अमरिकी डॉलर हो गया
2. B. दुनिया में सातवें सबसे बड़े हैं
3. C. 2024 में लगभग 24 बिलियन अमरिकी डॉलर के BoP घाटे के कारण कमी आई
4. D. उपरोक्त में से एक से अधिक