PM Modi and US President Donald Trump
India has taken a big decision to further strengthen the economy amid tariff tension running from America. The Reserve Bank of India has increased its gold reserves compared to investing in American Treasury Bills. In June last year, India invested $ 242 billion or about 21 lakh crore rupees in the US Treasury. It has been reduced to 227 billion dollars i.e. 20 lakh crores this year. The aim behind this is to strengthen its foreign exchange reserves of the country.
The dollar share is reduced, showing that countries around the world are now diving their foreign exchange reserves. According to Madan Sabnavis, Chief Economist of Bank of Baroda, gold is increasing continuously in India’s reserves and the rest of the foreign currency assets have also diversity.
For this reason, countries like India, China and Brazil have shown fluctuations. In the last 12 months, the dollar has been very wallet and during this time RBI has bought around 39.22 metric tons of gold. As of 27 June 2025, India’s Reserve had 879.98 metric tonnes, which was 840.76 metric tonnes last year.
Reduce cash risk
IDFC First Bank’s economist Gaura Sengupta quoted ET as saying that India’s holding decreased by $ 14.5 billion in a year despite the UST (American Treasury Bonds) falling yields. This means that India has diverted its foreign reserves out of the UST and increased the investment in gold. Due to this, the risk of damage caused by US-specific factors is being reduced.
Prior to Donald Trump’s power, India’s US Treasury Bills stock was at low level in December. As of 22 August 2025, India had nearly $ 227 billion USTS, which is part of its $ 690 billion reserves. On the other hand, China, the third largest holder of American Treasury Bills after Japan and Britain, is also decreasing its holding. In June 2024, China had $ 780 billion, which declined to $ 756 billion in June 2025. On the contrary, Israel has increased the investment in this asset class during this period.