Chennai: For the first time, India’s foreign exchange reserves crossed the half-a-trillion dollar mark after it surged by a massive $8.22 billion in the week ended 5 June due to higher foreign inflows.
As per the latest data from the Reserve Bank of India, the reserves rose to $501.70 billion in the reporting week, helped by a whopping rise in foreign currency assets (FCA).
In a tweet, Principal Economic Adviser in the Ministry of Finance Sanjeev Sanyal said, “India’s foreign exchange reserves hit $ 501.7 billion. As I have been saying in recent weeks, demand suppression… would push the INR to appreciate after an initial capital outflow.”
He added: “Now, as we open the economy to remove demand suppression, and push up credit growth, we will both revive imports and foreign capital inflows. The point is that demand identities imply macro-dynamics that is quite different from what naive forecasters suggest.”
This amount of foreign exchange reserves is equivalent to a year’s imports.
In the previous week ended 29 May, the reserves had increased by $3.44 billion to $493.48 billion.
In the week ended 5 June, FCA, which is a major component of the overall reserves, rose $8.42 billion to $463.63 billion.