Foreign exchange reserves indicate the reserves of the RBI kept in the form foreign currency assets, gold, SDR and reserve tranche position with the IMF. The forex reserve is kept as a cushion against any potential balanced of payment related crisis.
India’s foreign exchange reserves (total $391 bn as on 21, July 2017) comprises of:
(i) Foreign currency assets (FCA) (around $367 billion as on July 2017),
(ii) Gold, (around $20 billion as on July 2017)
(iii) Special Drawing Rights (SDRs) (around $14 billion as on July 2017) and
(iv) Reserve tranche position (RTP) in the International Monetary Fund (around $23 billion as on July 2017).
