Q.3 What is the significance of foreign exchange reserves for a developing country and what are the reasons for the recent decline in India’s foreign exchange reserves? (10 Marks)

Mentor’s comment- https://indianexpress.com/article/opinion/columns/rbi-and-the-rupee-to-break-a-free-fall-or-not-to-8059652/ In the intro, mention the steep decline in India foreing exchange in the last few months. In the body, mention reasons a developing economy needs foreign exchange reserves for the settlement of capital and current account settlement. In the next part mention the factors responsible for the decline in India’s foreign exchange … Continue reading Q.3 What is the significance of foreign exchange reserves for a developing country and what are the reasons for the recent decline in India’s foreign exchange reserves? (10 Marks)