An Analysis of India's Forex Reserves and its Determinants

Dr. R. Marimuthu

Abstract: As indicated earlier, Foreign exchange reserve is a barometer that reflects the economic strength of a nation. The low foreign exchange reserves were one of the compelling reasons for the introduction of economic reform in India. Therefore, it is imperative to analyse the growth of foreign exchange reserves before and after the adoption of economic reform to assess its impact. Over the last 19 years, the initiatives have generated an intense debate and considerable popular resistance. The desirability of the reforms and their effects remain contentious issues, and opinions continue to be divided. Hence this study tries to assess some aspects of economic reforms focusing mainly Foreign exchange reserves.

Keywords: Foreign exchange, US dollar, new economic policy, Rupee value, Re forms