New Delhi: India’s foreign exchange reserves recorded a sharp rise of nearly $10 billion, reaching $716.9 billion for the week ended August 14, 2026, according to data from the Reserve Bank of India (RBI). The increase pushed the country’s forex reserves to their highest level in around six months, strengthening India’s external financial position.
The latest rise comes amid strong foreign currency inflows and policy measures introduced by the RBI to attract overseas funds and strengthen the country’s balance of payments.
Forex Reserves Rise by Nearly $10 Billion
India’s total foreign exchange reserves climbed by approximately $9.9 billion week-on-week to $716.9 billion.
A major portion of the increase came from the RBI’s foreign currency assets, which rose by around $7.2 billion during the week. Gold reserves also contributed significantly, increasing by approximately $2.7 billion.
Foreign currency assets form the largest component of India’s forex reserves and include holdings denominated in major international currencies such as the US dollar, euro, pound sterling and Japanese yen.
India’s total reserves also include gold holdings, Special Drawing Rights and the country’s Reserve Tranche Position with the International Monetary Fund.
Reserves Have Grown by Around $50 Billion
The latest weekly increase is part of a broader upward trend.
India’s foreign exchange reserves have risen by approximately $50 billion over the past seven weeks, bringing them closer to the record level of about $728.5 billion reached earlier in February 2026.
The rapid accumulation provides the RBI with a larger financial buffer at a time when global markets continue to face uncertainty from geopolitical tensions, volatile crude oil prices and fluctuations in major international currencies.
RBI Measures Help Attract Foreign Currency
The increase in reserves has also been supported by measures introduced by the Reserve Bank of India in June to encourage foreign currency inflows.
These included incentives related to overseas borrowing and foreign exchange deposits, aimed at improving dollar availability and reinforcing India’s balance-of-payments position.
By August 13, these measures had reportedly helped attract nearly $57 billion in foreign currency inflows.
RBI Governor Sanjay Malhotra has indicated that overall inflows through the central bank’s subsidised swap windows could reach around $80 billion.
With inflows proving stronger than initially anticipated, the RBI has also moved to close one of its foreign exchange deposit-related schemes earlier than previously planned.
Why Strong Forex Reserves Matter
Foreign exchange reserves are an important indicator of a country’s ability to handle external financial shocks.
A large reserve position gives the central bank greater flexibility to manage sharp currency movements, meet international payment obligations and provide confidence to global investors.
For India, the rise is particularly important because the rupee has recently faced pressure from higher crude oil prices and strong demand for US dollars from importers.
The rupee ended at around 95.69 against the US dollar on August 21, while RBI intervention helped prevent a sharper decline beyond the 96-per-dollar level.
A stronger reserve position gives the central bank more room to intervene in foreign exchange markets when necessary to reduce excessive currency volatility.
India Moves Closer to Record Forex Levels
At $716.9 billion, India’s reserves are now within reach of their previous record high.
The latest figures underline the impact of sustained capital inflows and RBI measures designed to strengthen the country’s external finances.
However, global crude oil prices, geopolitical developments and international capital flows will remain key factors influencing the future direction of both India’s foreign exchange reserves and the rupee.
For now, the nearly $10 billion weekly jump provides India with a stronger external buffer and marks another notable improvement in the country’s forex position.
Source – Reuters
Supreme News Network
