Mumbai: India’s foreign exchange reserves surged by $7.260 billion to $674.193 billion in the week ended July 3, reversing the decline recorded in the previous week, according to data released by the Reserve Bank of India (RBI) on Friday.
The value of India’s gold reserves rose by $2.669 billion to $105.205 billion during the reporting week.
The country’s holdings of Special Drawing Rights (SDRs) with the International Monetary Fund also increased by $65 million to $18.623 billion.
The country’s forex reserves had fallen in the preceding reporting week. The foreign exchange reserves declined by $5.65 billion to $666.93 billion in the week ended June 26.
Despite the recent volatility, India’s reserves remain among the highest globally, although they are below the record high of $728.494 billion reached in the week ended February 27.
Meanwhile, banks have registered a gradual increase in the flow of overseas funds after the rollout of the Reserve Bank of India’s (RBI) revised Foreign Currency Non-Resident Bank (FCNR-B) deposit scheme and expect collections to accelerate further this month as awareness among NRIs is growing.
The banking industry has mobilised an estimated $3-4 billion through FCNR-B deposits so far, according to reports. Bankers expect inflows to gather pace in the coming weeks, particularly from non-resident Indians based in the Gulf region, the reports added.
Notably, the revised scheme is expected to attract $40-50 billion in fresh FCNR-B deposits over time, according to bankers. They said higher interest rates and the Reserve Bank of India’s decision to bear banks’ hedging costs are expected to support deposit mobilisation.
Banks have intensified outreach efforts to raise awareness of the revised FCNR-B scheme among overseas depositors. Lenders are engaging more actively with NRI customers across key overseas markets to encourage participation.
Bankers expect the Gulf region to contribute a significant share of incremental FCNR-B deposits, driven by Indian expatriates living and working in the region.
(IANS)
