India’s Prime Minister, Narendra Modi said the country’s forex reserves have increased to $630 billion from $200-275 billion seven years ago.

He made the revelation while addressing Bharatiya Janata Party (BJP) workers Wednesday on the 2022 budget.

“Seven years ago, $275 billion was reserved in India and today, the foreign exchange reserve is around $630 billion,” Modi said.

He gave his government the credit for the phenomenal increase.

He called the Union Budget 2022 “progressive” and said the country’s GDP has increased by over 1 lakh crore in seven or eight years.

“The budget has been appreciated. Seven-eight years ago, India’s GDP was Rs 1 lakh 10,000 crore. But today, it’s about Rs 2 lakh 30,000 crore.

“In 2013-14, India’s exports were around Rs 2 lakh 50,000 crore. But today, the export is around 4 lakh 70,000 crore,” PM Modi said.

AFFIRMING

As of end-November 2021, India was the fourth-largest foreign exchange reserves holder in the world after China, Japan, and Switzerland, the Economic Survey 2021-22 has noted.

Despite all the disruptions caused by the global pandemic, India’s balance of payments remained in surplus throughout the last two years. This allowed the Reserve Bank of India to keep accumulating foreign exchange reserves, which stands at $634 billion on December 31, 202). This is equivalent to 13.2 months of imports and higher than the country’s external debt.

A sizeable accretion in reserves led to an improvement in external vulnerability indicators such as foreign exchange reserves to total external debt, short-term debt to foreign exchange reserves, DeccanHerald says.

India’s salient external sector sustainability indicators are strong and much improved as compared to what they were during the global financial crisis or taper episode of 2013.

For instance, the import cover and foreign exchange reserves are more than double now. The combination of high foreign exchange reserves, sustained foreign direct investment, and rising export earnings will provide a good buffer against any liquidity tapering/monetary policy normalisation in 2022-23.