Q125
Indian EconomyExternal Sector & International Organisations
India's foreign exchange reserves have continuously increased since 2000-01 because of
- a.speeding up of economic reforms.
- b.relatively higher interest rates in India compared to rates prevailing in the international capital market.
- c.a strong bullish turn in the Indian stock market attracting foreign institutional investors.
- d.All of the above
Answer: (D) All of the above
The rise in reserves after 2000–01 came from several reinforcing causes: continued reforms attracting FDI, higher Indian interest rates drawing debt inflows and NRI deposits, and a booming stock market attracting FII investment. Each listed factor contributed, so 'All of the above' is correct.