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Forex reserves at new high of $64.62 bn

India's foreign exchange reserves reached a new high of $64.62 billion on November 1, and analysts expected dollars to keep flowing into the country because of growing exports and expatriate remittances.

Data released by the Reserve Bank of India on Saturday showed that the reserves were up by $582 million from a week ago.

The reserves are up $10.47 billion since the start of the financial year in April.

"There have been a lot of dollar inflows on account of export of software and IT-enabled services," said Dhananjay Sinha, analyst with JM Morgan Stanley.

"Besides, merchandise exports have done reasonably well. Expatriate remittances are also higher because of the uncertain global economic environment and geo-political risks," he said.

Indian exports had posted a year-on-year growth of 13.5 per cent in April-September, the first half of the current financial year to March, driven by demand from the key US and European Union markets.

In the first April-June quarter, "miscellaneous" receipts -- which includes inflows from the export of software and telecommunication services -- had doubled to $963 million.

Data for the July-September quarter will be released at the end of December.

Analysts attributed this to the growing trend among major global companies to transfer functions such as client servicing and data gathering to India to benefit from lower costs.

"We believe such inflows -- with higher merchandise exports -- will continue to push the reserves higher," Sinha said.

The persistent influx of dollars has helped the rupee, which closed Friday at a nine-and-half month high of 48.2625/2675, taking its rise from a life low of 49.08 in mid-May to 1.7 per cent.

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