The Economic Survey 2012-13 presented by the Union Finance Minister, Shri P. Chidambaram in the Lok Sabha today has stated that the Foreign Exchange Reserves in the current fiscal, on month-on-month basis remained in the range of US $ 286.0 billion (at end-May 2012) to US $ 295.6 billion (at end-December 2012).

By end of December 2012, reserves stood at US $ 295.6 billion, indicating a marginal increase of US $ 1.2 billion from US $ 294.4 billion in March, 2012. At this level, reserves provided about seven months of import cover, the Survey observes.

India’s foreign exchange reserves comprise foreign currency assets (FCA), gold , special drawing rights (SDRs) and reserve tranche position (RTP) in the International Monetary Fund (IMF). The level of foreign exchange reserves is largely the outcome of the Reserve Bank of India (RBI) intervention in the foreign exchange market to smoothen exchange rate volatility and valuation changes due to movement of the US dollar against other major currencies of the world.

DS: UM:RCJ:CP: foreign exchange (27.2.2013)

(Release ID :92589)

Foreign exchange reserves stabilise import cover as central bank intervenes to smooth exchange volatility and valuation impacts. Foreign exchange reserves remained broadly stable over the fiscal months cited, showing only a marginal increase from March to end December and providing about seven months of import cover. Reserves consist of foreign currency assets, gold, special drawing rights and the IMF reserve tranche position, and their level is largely the result of Reserve Bank of India intervention to smooth exchange rate volatility and valuation changes due to movements of the US dollar against other major currencies.