The share of gold in India’s foreign exchange reserves rose to just over 7% at the end of March 2022, from 5.88% at the end of September 2021, the Reserve Bank of India (RBI) said in a report released on Thursday. At end-March 2022, the RBI held 760.42 metric tonne of gold (including gold deposits of 11.08 metric tonne). “While 453.52 metric tonne of gold is held overseas in safe custody with the Bank of England and the Bank of International Settlements (BIS), 295.82 metric tonne of gold is held domestically,” the central bank said in its half-yearly report on foreign exchange reserves.
The value of forex reserves fell during the half-year period under review to $607.31 billion at the end of March 2022 from $635.36 billion at the end of September 2021. Movements in the foreign currency assets occur mainly on account of purchase and sale of foreign exchange by the RBI, income arising out of the deployment of the foreign exchange reserves, external aid receipts of the central government and changes on account of revaluation of assets. At the end of December 2021, foreign exchange reserves cover of imports (on balance of payments basis) declined to 13.1 months from 14.6 months at end-September 2021.
The ratio of short-term debt (original maturity) to reserves, which was 16.5% at end-September 2021, increased to 18.1% at end-December 2021.The ratio of volatile capital flows (including cumulative portfolio inflows and outstanding short-term debt) to reserves increased from 64.1% at end-September 2021 to 65.0% at end-December 2021.