India’s forex reserves rise by over $4b

India’s foreign exchange reserves rose by $4.235 billion during the week ended May 8th, RBI data showed on Friday. According to the RBI’s weekly statistical supplement, the overall forex reserves increased to $485.313 billion from $481.078 billion reported for the week ended May 1.

India’s forex reserves comprise foreign currency assets (FCAs), gold reserves, special drawing rights (SDRs) and India’s reserve position with the International Monetary Fund (IMF).

On a weekly basis, FCAs, the largest component of the forex reserves, edged higher by $4.233 billion to $447.548 billion. Similarly, the value of the country’s gold reserves increased but marginally. It rose by $13 million to $32.291 billion. However, the SDR value slipped by $3 million to $1.423 billion.

In addition, the country’s reserve position with the IMF fell by $8 million to $4.051 billion.

Separately, India’s GDP for the financial year 2020-21 is likely to grow in the range of 0.9 per cent to 1.02 per cent, according to a report by Crediwatch.

“In case the lockdown gets extended till May end (which is a more likely scenario in some states), we will only be able to see any green shoots of recovery towards the end of Q3, the GDP will range from 0.9 per cent to 1.02 per cent,” it said.

Several states have extended the lockdown and Prime Minister Narendra Modi in his address to the nation on Tuesday hinted at a relaxed alockdown 4.0’. The third phase of the nationwide lockdown ends on May 17, Sunday.

On the economic package being announced by the government, Meghna Suryakumar, CEO of Crediwatch said: “If the stimulus works it will be between 1 to 1.02 per cent, I believe 1 per cent GDP growth is what everybody is looking at.” The coronavirus pandemic and the nationwide lockdown has brought the Indian economy to almost a halt and industry bodies and economists has anticipate huge job losses, shutting down of businesses in case adequate government support does not come in.

Indo-Asian News Service