MUMBAI– India’s foreign exchange reserves climbed by $4.5 billion to reach $702.3 billion for the week ending October 17, driven primarily by a sharp increase in the value of gold holdings, according to data released Friday by the Reserve Bank of India (RBI).
Gold reserves surged by $6.2 billion during the week, crossing the $108.5 billion level for the first time. The rise reflected both a global surge in gold prices and continued accumulation by the central bank.
Meanwhile, foreign currency assets — the largest component of the reserves — declined by $1.7 billion to $570.4 billion, as valuation changes in major currencies such as the euro, pound, and yen impacted overall holdings. India’s reserve position with the International Monetary Fund (IMF) also slipped by $30 million to $4.62 billion.
Market analysts noted that the share of gold in India’s overall foreign exchange reserves has nearly doubled over the past decade, rising from below 7 percent to almost 15 percent — the highest level since 1996–97.
Gold prices have climbed about 65 percent so far in 2025, driven by heightened geopolitical tensions in the Middle East and ongoing trade frictions linked to U.S. tariff increases. Central banks across the world, including the RBI, have been adding gold to their reserves as a hedge against global uncertainty.
According to a Morgan Stanley report, the RBI has added roughly 75 tonnes of gold since 2024, taking its total holdings to around 880 tonnes — about 14 percent of India’s total foreign exchange reserves.
India remains the world’s second-largest consumer of gold after China. The metal plays a vital role in Indian households, both as a traditional form of jewelry for weddings and as a preferred safe-haven investment amid economic uncertainty. (Source: IANS)
