India's foreign exchange reserves have witnessed a substantial increase, climbing by $1.68 billion to reach $688.94 billion for the week ending December 12, according to the Reserve Bank of India (RBI). This marks the second consecutive week of growth in the nation's forex reserves.
The rise was primarily fueled by a significant boost in gold holdings, which increased by $758 million, reaching a total value of $107.741 billion. This increase in gold reserves reflects a strategic move towards diversification.
Foreign currency assets, a major component of the overall reserves, also saw an increase of $906 million, bringing the total to $557.787 billion. It's important to note that foreign currency assets are expressed in dollar terms and include the effects of appreciation or depreciation of non-US units like the Euro, Pound, and Yen.
In addition to gold and foreign currency assets, Special Drawing Rights (SDRs) with the International Monetary Fund (IMF) also experienced a slight uptick, rising by $14 million to $18.735 billion. India's reserve position in the IMF also saw a marginal increase of $11 million, reaching $4.686 billion.
In the previous week ending December 5, the country's forex reserves had already risen by nearly $1.03 billion, reaching $687.26 billion. The RBI has stated that it continues to closely monitor developments in the foreign exchange market and will intervene as needed to maintain orderly market conditions.
Meanwhile, India has recorded strong Foreign Direct Investment (FDI) commitments during the current financial year. Total FDI inflows during the first half of FY 2025-26 stood at $50.36 billion, marking a 16 percent increase compared to $43.37 billion in the corresponding period last year. Gross FDI inflows have risen steadily from over $34 billion in 2012-13 to more than $80 billion in 2024-25. India also recorded a strong rebound in FDI during the second quarter of the current financial year, with inflows rising over 18 per cent year-on-year to $35.18 billion during April–September 2025. The increasing trend of repatriation suggests that India is not only attracting foreign capital but also delivering strong returns to global investors, strengthening its image as a reliable investment destination. India's forex reserves are among the largest in the world, providing import cover of over 11 months.
