The Hindu : Business : Coveted position in forex, gold

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Friday, Feb 26, 2010
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Coveted position in forex, gold

Sandeep Joshi

NEW DELHI: In its efforts to improve foreign exchange reserves, India has now become the 10th largest gold-holding nation in the world. It has also emerged as the fourth-largest foreign exchange reserves holder only after China, Japan and Russia, says the Economic Survey 2009-10.

“In September last, the International Monetary Fund decided to sell 403.3 tonnes of gold as a central element of its ‘New Income Model' and to increase its resources for lending to low-income countries.

“Consequent of this, the Reserve Bank of India concluded the purchase of 200 tonnes of gold from the IMF at the cost of $6.7 billion as part of its foreign exchange reserves management operation,” the survey says.

“With this purchase, gold holdings in the country's foreign exchange reserves have increased from 357.7 tonnes to 557.7 tonnes, which is about 6 per cent of the reserves. Post-purchase, India has become the 10th largest official gold-holding country in the world,” it adds.

In another interesting development, India is ranked fourth in terms of foreign exchange reserves at $283.5 billion, only behind China ($2,399.2 billion), Japan ($1,049.4 billion) and Russia ($439 billion), says the Economic Survey.

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