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[RBI] Sources Of Variation In Foreign Exchange Reserves In India During April-December 2017

Mar 16, 2018: Earlier today, the Reserve Bank of India released balance of payments (BoP) data for October-December 2017 on its website. On the basis of these data, the sources of variation in foreign exchange reserves during April-December 2017 have been compiled.

During April-December 2017, there was an increase in the foreign exchange reserves. The sources of variation in the foreign exchange reserves are set out in Table 1.

Table 1: Sources of Variation in Foreign Exchange Reserves*
Sources of Variation in Foreign Exchange Reserves India
*: Based on old format of BoP which may differ from the new format (BPM6) in the treatment of transfers under the current account and ADRs/ GDRs under portfolio investment.
@: Difference, if any, is due to rounding off.
Note: ‘Other items in capital account’ apart from ‘Errors and Omissions’ include SDR allocation, leads and lags in exports, funds held abroad, advances received pending issue of shares under FDI and capital receipts not included elsewhere.


On a balance of payments basis (i.e., excluding valuation effects), the foreign exchange reserves increased by US$ 30.3 billion during April-December 2017 as compared with an increase of US$ 14.2 billion during April-December 2016. The foreign exchange reserves in nominal terms (including valuation effects) increased by US$ 39.1 billion during April-December 2017 as against the depletion of US$ 1.3 billion during the same period of the preceding year (Table 2).

Table 2: Comparative Position of Variation in Reserves
Comparative Position of Variation in Reserves in India
Note: Increase in reserves (+)/Decrease in reserves (-).
Difference, if any, is due to rounding off.

The valuation gain, mainly reflecting the depreciation of the US dollar against major currencies, amounted to US$ 8.8 billion during April-December 2017 as against a loss of US$ 15.5 billion during the same period of the preceding year.


Source: Reserve Bank of India (RBI)

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