Forex reserves at $295 billion as on end-September: RBI

MUMBAI: Despite a steep fall in rupee value and intermittent market interventions by the Reserve Bank, India's forex reserves rose by over $400 million to $ 294.84 billion between end-March and September 2012.


"The forex reserves stood at $ 294.4 billion as end- March 2012. During the half year under review, it came down to $ 286 billion at the end of May after which it followed upward trend and increased to $ 294.8 billion at the end of September 2012," RBI said in its half-yearly report on the forex reserves today.

The net forward liability of the RBI in domestic forex market stood at $ 14.05 billion as at the end of September 2012. On the other hand, external liabilities vis-à-vis forex reserves, known as the international investment position ( IIP)

- that summarises the stock of external financial assets and liabilities - stood at a negative at $ 271.5 billion, implying that our external liabilities are more than the external assets during the reporting period, it said.

The net IIP as of end-March 2012 stood at USS(-) 248.4 billion, the RBI data showed.

However, the report noted that at the end of September 2012, the import cover improved marginally to 7.2 months from 7.1 months at end-March 2012. The ratio of short-term debt to the foreign exchange reserves which was 26.6 per cent.

The ratio of volatile capital flows (defined to include cumulative portfolio inflows and short-term debts) to the reserves rose from 79.9 per cent as at end-March 2012 to 83.9 per cent as at end-September 2012, it said.

However, the rate of earnings on forex currency assets and gold declined from 1.74 per cent in July 2010-June 2011 to 1.47 per cent in July 2011-June 2012, reflecting the generally low global interest rate environment.

The report said Reserve Bank held 557.75 tonne gold, about 9.5 per cent of the total forex reserves in value terms, as of end-September 2012.

"Of these, 265.49 tonne are held abroad in safe custody with the Bank of England and the Bank for International Settlements," the report said.