Question
Which one of the following groups of items is included in India’s foreign-exchange reserves?
(a) Foreign-currency assets, Special Drawing Rights (SDRs) and loans from foreign countries
(b) Foreign-currency assets, gold oldings of the RBI and SDRs
(c) Foreign-currency assets, loans from the World Bank and SDRs
(d) Foreign-currency assets, gold holdings of the RBI and loans from the World Bank
Answer:
B
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Explanation:
India's foreign-exchange reserves comprise various components. The major components of India's foreign-exchange reserves include:
Foreign-currency assets: These include foreign currencies held by the Reserve Bank of India (RBI), such as US dollars, euros, yen, etc.
Gold holdings of the RBI: This refers to the quantity of gold held by the RBI as part of its reserves.
Special Drawing Rights (SDRs): SDRs are international reserve assets created by the International Monetary Fund (IMF) and allocated to member countries. SDRs are a form of international currency that can be used in transactions between central banks and the IMF.
Other components, such as loans from foreign countries or international financial institutions like the World Bank, are not considered as part of India's foreign-exchange reserves.