Kolkata: The Reserve Bank seems to be quietly moving towards gold away from US Treasury Bills to shore up its forex reserves, reports indicate. The investment of India in T Bills of the US was down to $227 billion in June this year. It marked a dip of 6.6% compared to the figure of $242 billion in June 2024. However, there was a rise in the central banks investment in gold. On the other hand, India’s central bank has raised its gold holdings to 879.98 tonnes till June 27, 2026 compared to 840.76 tonnes in June 2024 — signaling a rise of 4.45%, reports stated.
Data, however, show that India still remains a significant — in fact, one among the top 20 — investors in US T Bills and New Delhi’s investments are higher than that of Germany and Saudi Arabia. Treasury bills (ot T bills) are short-term debt instruments issued by governments to fund their operations, with maturities of less than a year. They are considered safe investments.
China has slashed investments in US T bills too
Significantly, China, too, has slashed investments in US Treasury Bills. While Beijing’s investment in this instrument was $780 billion in June 2024, it climbed down to $756 billion in June this year. China is the third largest investor in US T Bills after Japan and the UK.
Experts have echoed the same interpretation. “Indian reserves have witnessed a steady buildup of gold, alongside diversification in forex currency assets. This reflects a wider global trend of reducing reliance on the dollar amid trade conflicts and geopolitical tensions,” Bank of Baroda chief economist Madan Sabnavis was quoted in the media as saying.
“Efforts to mitigate revaluation risks”
“India’s UST holdings fell by $14.5 billion over one year despite lower yields, showing a deliberate diversification away from USTs. The rise in gold reflects efforts to mitigate revaluation risks tied to US-specific factors such as worsening fiscal metrics and elevated yields,” Gaura Sengupta, economist at IDFC First Bank, told the media. Records show that India’s holding of US T Bills reached it lowest point in December 2024 before Donald Trump took charge. This indicates it rose in the subsequent months and dipped again.
India’s overall foreign exchange reserves stands at a robust $690 billion as of August 22, 2025 including the amount of investments in US T Bills. The development comes against the backdrop of US President Donald Trump’s tariff whiplash against India, whereby he imposed 50% additional and retaliatory tariff on imports from India. he justified his action by alleging that India kept US products out of its market with the help of tariff walls and that New Delhi was buying crude oil from Moscow, thereby ignoring his diktat. Though China and India have cut down on their exposure to US T Bills, Israel significantly increased investments in this instrument between June 2024 and June 2025.