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India's Forex Reserves Hit $689 Billion: What's Driving the Surge?

India's foreign exchange reserves have grown once again, reaching nearly $689 billion. This increase was supported by a healthy rise in the country's gold holdings. At the same time, foreign direct investment is hitting record levels, showing strong global confidence. These trends highlight India's growing economic strength and its appeal as a stable investment destination.

Key Points: India Forex Reserves Rise to $688.94 Billion, Gold Holdings Up

  • Forex reserves increased by $1.689 billion to $688.94 billion for the week ending December 12
  • Gold reserves rose by $758 million, reaching $107.741 billion during the same period
  • FDI inflows surged 16% in H1 FY26, hitting a record $50.36 billion
  • The RBI actively monitors and intervenes in forex markets to ensure orderly conditions
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India's forex reserves rise $1.689 billion to $688.94 billion

India's forex reserves climb $1.689 billion to $688.94 billion, with gold reserves also rising. Strong FDI inflows bolster economic resilience.

"The increasing trend of repatriation indicates that India is not only attracting foreign capital but also delivering strong returns. - Official Data"

New Delhi, Dec 19

India’s foreign exchange reserves went up by $1.689 billion to $688.94 billion for the week ending on December 12, the Reserve Bank of India (RBI) said on Friday.

Gold reserves increased by $758 million to $107.741 billion during the week, the central bank said. The Special Drawing Rights (SDRs) were up by $14 million to $18.735 billion.

Last week, foreign exchange reserves went up by nearly $1.03 billion to $687.26 billion for the week ending December 5. Gold reserves increased by $1.188 billion to $106.984 billion during the week, the RBI said. The Special Drawing Rights (SDRs) were up by $93 million to $18.721 billion.

The RBI routinely monitors developments in the foreign exchange market and undertakes interventions when necessary to preserve orderly trading conditions.

Meanwhile, India witnessed an unprecedented surge in foreign direct investment (FDI) commitments this year. Total FDI inflow reported during the first half of FY 2025-26 ($50.36 billion) increased by 16 per cent compared to the year-ago period ($43.37 billion) -- the highest ever for the first half of a financial year, the Parliament was informed earlier this month.

Gross FDI inflows have increased from over $34 billion in 2012-13 to over $80 billion in 2024-25. As per official data, India recorded a strong rebound in FDI in the second quarter of the current financial year, with total inflows rising over 18 per cent year-on-year to $35.18 billion during April–September 2025.

The increasing trend of repatriation indicates that India is not only attracting foreign capital but also delivering strong returns, which enhances its reputation as a reliable investment destination. The government has leveraged the free trade agreements for the promotion of export diversification and attract investment.

- IANS

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Reader Comments

P
Priya S
Good to see the reserves growing, but I hope this strength translates into more stability for the rupee. Sometimes, despite high reserves, we see volatility. Also, the increase in gold reserves is a smart, traditional hedge.
R
Rohit P
FDI doubling from 2013 to now is the real headline here! $80 billion+ is no joke. It means more jobs, better infrastructure, and technology transfer. This is what "Aatmanirbhar Bharat" with global partnership looks like.
S
Sarah B
As someone who follows global economics, India's numbers are impressive, especially in the current climate. The fact that repatriation is increasing is key—it means investors are making profits and reinvesting, creating a virtuous cycle.
K
Karthik V
Solid numbers, but a respectful criticism: We must ensure this FDI is going into manufacturing and core sectors, not just speculative areas. Also, while reserves are high, our external debt is also significant. The RBI has a tricky balancing act.
M
Meera T
Every week it's a new record it seems! 😊 This builds so much confidence. When I talk to my NRI friends, they all want to invest back home now. The momentum is clearly with India. Hope this continues!

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