Foreign Currency Assets (FCA) that is the most important component of the RBI’s foreign exchange reserve are the assets like US Treasury Bills bought by the RBI using foreign currencies. The FCA is the largest component of the forex reserve.
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).
