India’s foreign exchange reserves have climbed to an unprecedented $729.33 billion, marking an extraordinary $63‑billion jump in just eight weeks. The sustained rise reflects strong dollar inflows, boosted primarily by the Reserve Bank of India’s (RBI) targeted measures to attract overseas funds — especially NRI deposits.
Data released by the RBI for the week ending 21 August shows reserves rising by $12.4 billion, extending an eight‑week streak of gains and surpassing the previous peak recorded in February. The surge follows a series of incentives introduced in June to pull more foreign currency into India’s balance of payments.
These measures included discounted hedging facilities for overseas borrowings by state‑run companies and banks, and a free‑of‑cost hedging window for banks raising foreign exchange deposits abroad. Between 5 June and 21 August, the RBI received nearly $73 billion through these schemes — with $65 billion coming from NRI deposits alone. The inflows were so strong that the central bank closed its deposit hedging facility a month early, ending it in August.
The latest reserve increase was led by foreign currency assets, which rose $9.5 billion to $591.33 billion. Gold holdings added another boost, climbing $2.8 billion to $114.22 billion. India’s Special Drawing Rights (SDRs) with the IMF increased to $18.85 billion, while its reserve tranche position rose to $4.93 billion. The composition of gains indicates contributions from both actual dollar purchases and valuation effects.