Proactive steps needed to limit adverse spillovers of Iran war: RBI report

Geopolitical events can trigger capital outflows and currency depreciation. Strong forex reserves are crucial for maintaining financial stability and investor confidence.

• •The report added that foreign exchange reserves remain adequate to provide a cushion against external shocks.
• •Forex reserves were at $709 billion as of March 13, after touching an all-time high of $729 billion in February.
• •The RBI said reserves provide cover for 11.2 months of goods imports and around 95% of the country's outstanding external debt.
• •Risk flag: Prolonged and severe global economic downturn
• •Risk flag: Unexpected rapid depletion of forex reserves