India’s foreign exchange reserves have surged past USD 700 billion for the first time in history, reflecting the Reserve Bank of India’s aggressive strategy to strengthen the rupee and stabilize the economy.
India’s forex reserves crossed a new milestone after rising by USD 4.698 billion in the week ending September 12, reaching USD 702.966 billion, according to the Reserve Bank of India’s Weekly Statistical Supplement. This marks the third consecutive weekly rise, highlighting the central bank’s success in managing foreign assets and ensuring economic resilience.
The largest component of reserves, foreign currency assets (FCA), grew to USD 587.014 billion, up by USD 2.537 billion. Gold reserves also added significant weight, climbing to USD 92.419 billion after an increase of USD 2.12 billion. Together, these gains demonstrate India’s ability to diversify and strengthen its financial position in the face of global uncertainty.
RBI Governor Sanjay Malhotra assured that the current forex holdings are sufficient to cover nearly 11 months of India’s imports, creating a comfortable buffer against external shocks. This robust position is seen as a confidence booster for international investors and domestic markets alike.
India’s forex reserves have experienced an extraordinary turnaround over recent years. In 2022, the nation faced a steep cumulative decline of USD 71 billion, driven by global volatility and high import costs. By 2023, however, reserves rebounded sharply, adding USD 58 billion. In 2024, the growth continued with an increase of slightly over USD 20 billion. So far in 2025, reserves have already climbed by approximately USD 53 billion, underscoring sustained momentum.
Foreign exchange reserves held by the RBI consist primarily of assets in major global currencies such as the US Dollar, Euro, Japanese Yen, and British Pound. By strategically balancing these assets, the RBI actively intervenes in currency markets, buying dollars when the rupee strengthens and selling when it weakens. This strategy has proven vital in preventing sharp depreciation and ensuring steady capital flows.
The crossing of the USD 700 billion threshold is not just symbolic but a critical marker of India’s rising economic power. With a solid forex base, India is better positioned to weather external headwinds, manage inflationary pressures, and attract long-term investment. Analysts predict that if the current growth trajectory continues, India could soon challenge the world’s largest reserve holders.
