The country’s foreign exchange reserves crossed the $450-billion mark for the first time ever on the back of strong inflows. At $451.7 billion, the country’s import cover is now over 11 months.
Why Reservers has increased at such a pace?
Net foreign direct investment rose to $20.9 billion in the first half of 2019-20 from $17 billion a year ago while net foreign portfolio investment was $8.8 billion in April-November 2019 as against net outflows of $14.9 billion in the same period last year.
Source: The Hindu
Relevant for GS Prelims & Mains Paper III; Economics