Q.3 Highlighting the factors affecting forex reserves, bring out the factors behind the recent decline in India’s forex reserves. (10 Marks)

Mentor’s Comments- https://indianexpress.com/article/business/economy/rising-inflation-strong-usd-forex-reserves-plummet-110-billion-in-13-months-8198127/#:~:text=by%20global%20developments.-,The%20rupee%20hit%20a%20record%20low%20of%2082.33%20against%20the,registered%20on%20September%203%2C%202021. In the introduction, explain what are forex reserves. In the body, first list down some of the factors that affect the forex reserves. Next, mention the reasons behind declining forex reserves in India in the recent past. Conclude optimistically.