India's foreign exchange reserves have experienced a remarkable increase from $1.82 billion in 1951-52 to approximately $690.69 billion as of May 2026, reflecting a 380x rise. This growth is attributed to several factors, including the 1991 economic liberalization, which opened the country to foreign investments, and the boom in the software and services sector. Additionally, India remains the world's largest recipient of remittances, providing a stable source of foreign currency. The Reserve Bank of India (RBI) has also adopted strategies to build a robust liquidity cushion, especially after the 2013 market fluctuations. As of May 2026, India's forex reserves consist of $551.83 billion in foreign currency assets, $115.22 billion in gold, $18.79 billion in Special Drawing Rights, and $4.86 billion in the Reserve Position in the International Monetary Fund (IMF). These reserves are crucial for covering about 11 months of imports and serve as a financial buffer against global economic uncertainties, reinforcing India's position as the fourth largest holder of forex reserves worldwide.