India pledged 67 tonnes of gold in 1991, bought 178 tonnes of gold in 4 years

RBI Gold Reserves: In 1991, when India did not have foreign currency for imports, India had to pledge its 67 tonnes of gold to take a loan of $ 2.2 billion. The then central government had taken this decision. But that picture has changed. India has redeemed the pledged gold, but today RBI has 8 percent of the world’s total reserve gold.

Due to the global economic uncertainty due to the Corona epidemic and then rising inflation, the Reserve Bank of India has made heavy purchases of gold. According to statistics, between March 2020 and March 2023, RBI has purchased 137.19 tonnes of gold. In just three years, there has been a jump of 79 percent in the gold reserve of RBI.

During this period, all the central banks of the world have bought gold. After purchasing more than 137 tonnes of gold in the last three years, RBI has reached the eighth position among all the central banks in the world in terms of gold reserves. In March 2020, the share of gold reserve in the total foreign exchange reserves of RBI was 6 per cent, which has increased to close to 7.85 per cent. The gold reserve with RBI has been increased to more than 790 tonnes.

As of March 2019, RBI had a total gold reserve of 612.56 tonnes, 653 tonnes in March 2020, 695.31 tonnes in March 2021, 760.42 tonnes in March 2022 and now it has crossed 790 tonnes. That is, RBI has bought more than 30 tonnes of gold in a year. In four years, RBI has bought 178 tonnes of gold.

In the environment of global economic and political instability, when the risk is more visible, then investment in gold increases for hedging. In such a situation, gold also plays the role of cross border currency. When the Central Bank prints more currency, it becomes necessary to increase the gold reserve to support it. Gold has more credibility than foreign currency, so in such a situation, central banks increase the purchase of gold.

According to the World Gold Council, all the central banks around the world were engaged in buying gold in view of the economic upheaval, so the RBI also did not lag behind. In 2022, central banks around the world have bought 1136 tonnes of gold, which is the highest since 1967.

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