India's forex reserves hit record $740.8 billion on strong inflows

India's forex reserves climbed $11.475 billion to reach a fresh all-time high of $740.803 billion during the week ended August 28, according to data released by the RBI on Friday. The latest surge follows a $12.422 billion increase in the preceding week, when reserves had touched $729.328 billion.

The reserves have staged a remarkable recovery since breaching their previous all-time high of $728.494 billion recorded on February 27. That earlier peak preceded a period of volatility triggered by geopolitical tensions in the Middle East, which prompted the central bank to intervene in forex markets through selective dollar sales to support the rupee.

The turnaround has been underpinned by the RBI's concessional forex swap scheme, launched in June as the rupee came under depreciation pressure. The facility has proven highly effective, attracting over $132 billion in new foreign currency flows. For the week ended August 28 alone, foreign currency assets—the dominant component of overall reserves—increased by $9.337 billion to $600.67 billion.

The sustained accumulation of reserves reflects India's strengthened external position and improved investor confidence in the economy, even as global financial conditions remain uncertain.