RAS question
India's foreign exchange reserves crossed which historic milestone for the first time during the week ending September 27, 2024?
Correct answer: (A) USD 700 billion.
India's foreign exchange reserves crossed the USD 700 billion mark for the first time during the week ended September 27, 2024.
Explanation
The official Lok Sabha answer from the Ministry of Finance states that India's foreign exchange reserves crossed the USD 700 billion mark for the first time in the week ended September 27, 2024, standing at USD 704.88 billion. USD 700 billion was therefore the precise milestone, not a lower or higher round figure. The event belonged to a wider external-sector context: as at end-September 2024, India had the fourth-largest forex reserves after China, Japan and Switzerland. Prudent reserves matter because, alongside sound policies and fundamentals, they help reduce balance-of-payments crisis risk, preserve economic and financial stability under exchange-rate pressure, and create room for policy autonomy.
Why the other options are wrong
- (B) USD 650 billion is below the official first-crossing milestone; the Lok Sabha answer records reserves at USD 704.88 billion in the week ended September 27, 2024.
- (C) USD 750 billion overstates the milestone because the official figure for that week was USD 704.88 billion, just above USD 700 billion.
- (D) USD 600 billion is too low because India's reserves first crossed the historic USD 700 billion threshold in the week ended September 27, 2024.
Concept
The external sector segment of the Indian Economy syllabus covers forex reserves and balance-of-payments stability. RAS milestones connect current data with macroeconomic resilience and policy autonomy.