With reference to India's Foreign Exchange Reserves, consider the following statements: 1. They consist of Foreign Currency Assets, Gold, SDRs, and Reserve Tranche Position. 2. Special Drawing Rights and Reserve Tranche Position are maintained with the World Bank. 3. RBI uses forex reserves to intervene in the currency market to stabilize the value of the Rupee. Which of the statements given above is/are correct? |ForumIAS

[A] 1 and 2 only

[B] 1 and 3 only

[C] 2 and 3 only

[D] 1, 2 and 3

Answer: B

Notes:

Explanation:

India’s forex reserves include Foreign Currency Assets (FCA), Gold, Special Drawing Rights (SDRs), and Reserve Tranche Position (RTP).
SDRs and RTP are maintained with the International Monetary Fund (IMF), not the World Bank.
The RBI uses forex reserves to stabilize the currency, especially during excessive depreciation of the Rupee, by intervening in the foreign exchange market.

Source: Indian Economy (Ramesh Singh)