The International Monetary Fund (IMF) allocated a Special Drawing Rights (SDRs) 12.57 billion (equivalent to around USD 17.86 billion at the latest exchange rate) to India in August 2021.
- The total SDR holdings of India now stands at SDR 13.66 billion (equivalent to around USD 19.41 billion at the latest exchange rate).
The largest-ever SDR Allocation:
i.In August 2021, the Board of Governors of the IMF had approved a general allocation of about SDR 456 billion to its members in proportion to their existing quotas in the IMF.
ii.The SDR 456 billion is the largest ever SDR allocation by the IMF. It was approved by it on August 2, 2021 (effective on August 23, 2021).
iii.Under the general allocation, the share of India is SDR 12.57 billion (around 2.75 percent).
About Special Drawing Rights (SDR):
i.The SDR is an interest-bearing international reserve asset created by the IMF in 1969 to supplement the official reserves of its member countries.
ii.The value of the SDR is based on 5 international currencies viz, the U.S. dollar, the euro, the Chinese renminbi, the Japanese yen, and the British pound sterling.
iii.SDR is neither a currency nor a claim on the IMF. It is just a potential claim on the freely usable currencies of IMF members.
- To date, a total of SDR 660.7 billion (US$ 943 billion) have been allocated.
iv.SDR holdings are one of the components of the Foreign Exchange Reserves (FER) of India. The SDR allocation will supplement India’s FER, and reduce the reliance on external debt.
Recent Related News:
India became the 4th largest foreign exchange (Forex) reserves holder globally after China, Japan, and Switzerland. India’s Forex reserves in the week ended July 16, 2021, rose by $835 million to touch a record high of $612.73 billion.
About International Monetary Fund (IMF):
Establishment – 1944
Headquarters – Washington, D.C, United States (US)
Managing Director – Kristalina Georgieva
Members – 190 Countries (Including India)