India rejected the grounds of the US Finance Department being put on the watch list of those who manipulated currency behavior. Commerce Secretary Anoop Wadhawan said that the activities of the central bank in the foreign exchange market are balanced and it is not collecting foreign exchange reserves. The US has put India on this watchlist for the second time since the onset of the epidemic. The reason for the purchase of dollars by the central bank is more than five percent of GDP. The US Department of Finance has said that this limit should be two percent.
Wadhawan said that such monitoring lists have started to be made recently. It is an intervention in the policy area of the central bank. I do not understand the economic logic behind this. India's total foreign exchange reserves are stable at between 500 and 600 billion dollars. India is not collecting foreign currency like China.
Wadhawan said that the country's central bank has fully legitimate operations. The main function of the central bank is to provide stability to the currency. This is why the central bank buys and sells foreign currency. Our total foreign exchange reserves are fairly stable.