India's foreign exchange (forex) market has experienced a remarkable surge in recent years, underscoring its growing significance in the global financial landscape. According to Reserve Bank of India (RBI) Governor Sanjay Malhotra, speaking at the 24th FIMMDA-PDAI Annual Conference in Bali on Friday (April 18), the average daily turnover in India's forex market nearly doubled from USD 32 billion in 2020 to USD 60 billion in 2024.
Governor Malhotra emphasized that this substantial growth reflects significant transformations and advancements in India's financial markets, making them more dynamic and resilient. He highlighted that alongside the forex market, other segments such as the overnight money market and government securities (g-secs) market have also witnessed robust expansions. The overnight money market saw an 80 per cent increase in average daily volumes, surging from approximately Rs 3 lakh crore in 2020 to over Rs 5.4 lakh crore in 2024. Similarly, the g-secs market reported a 40 per cent rise in average daily volumes, reaching Rs 66,000 crore during the same period.
"Financial markets play a vital role in India's economic progress," Governor Malhotra affirmed. "As our markets continue to evolve, they serve not only as avenues for capital raising and asset trading but also as key enablers of economic growth."
Despite global challenges, particularly in the context of the government securities market, Governor Malhotra expressed satisfaction with its stability throughout the year. He highlighted that gross market borrowings by the central and state governments amounted to Rs 24.7 lakh crore in the fiscal year 2024-25, executed smoothly without disruptions.
Concluding his address, Governor Malhotra outlined India's significant strides in developing its financial markets, attributing their maturity and advancement to a commitment to transparency and robust infrastructure.
"Motivated by our nation's evolving needs and guided by lessons from past crises, our financial markets have matured significantly," Governor Malhotra concluded. "Our market infrastructure stands as a testament to state-of-the-art standards, ensuring transparency that ranks among the world's best."
The governor's remarks underscore India's trajectory towards becoming a pivotal player in the global financial arena, driven by resilient market dynamics and a commitment to economic stability and growth.
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