India is in a position to be thrown out of the list of top five countries in terms of forex reserves

Mumbai: India has dropped out of the top five countries in terms of forex reserves. For some time now, India has been occupying the fifth position after Russia in forex reserves, but India is on the verge of losing this position due to continuous decline in reserves.

In the week ended September 16, the forex reserve of the country has decreased by 5.20 billion dollars to 545.65 billion dollars. Taiwan is currently in sixth place after India. Taiwan's forex reserve figure is $545.48 billion. However, this figure for Taiwan is as of the end of August.

In terms of forex reserves, China ranks first with $3223.76 billion. On September 16, Russia's forex reserves stood at $557.70 billion.

A one-way decline in India's foreign exchange reserves is continuing due to the continued depreciation of the rupee against the dollar along with the decline in the stock market and the outflow of foreign investors. India's foreign exchange reserves declined for the seventh consecutive week.

Due to the strengthening of the dollar, the Reserve Bank has to sell dollar reserves to support the rupee. The rupee has depreciated by more than 8 percent so far this year.

The rupee has been under pressure since the Ukraine crisis. This week, the rupee has touched a low of 81 for the first time in history.

According to the weekly data released by the RBI, foreign currency assets accounted for the decline in foreign exchange reserves in the week ended September 16. FCA fell by $4.698 billion to $484.901 billion during the week under review.

Gold reserves decreased by $460 million

According to the data, the gold reserve value has decreased by 45.8 million dollars to 38.186 billion dollars. Apart from this, the Special Drawing Rights have decreased by 3.2 million dollars to 17.686 billion dollars and the reserve fund of the country with the IMF has decreased by 3.1 million dollars to 4.88 billion dollars.

The trend of decline in foreign currency reserves is expected to continue in the near future as the depreciation of the rupee continues. The stock market has already crashed this week due to the interest rate hike by the US Federal Reserve, but the rupee touched a low of 81 against the dollar for the first time. In the last three days, the value of the rupee has decreased by 124 paise per dollar.

The Reserve Bank sold $19 billion of reserves in July itself to support the rupee. This was the highest dollar sale by the RBI since March 2022. In March, RBI sold reserves worth $20.10 billion. A total of 85 billion dollars of reserves have been sold so far this year.