Mumbai, Sep 12: India has become the fourth largest holder of foreign exchange reserves in the world after the record surge in dollar inflows triggered by the Reserve Bank of India’s (RBI’s) foreign currency non-resident (bank) (FCNR(B) deposits scheme, according to data.

With the $44.9 billion increase in its forex kitty to a record $785.7 billion during the week ended September 4, India has dislodged Russia from the fourth spot and is now ranked only behind China, Japan, and Switzerland, the data compiled by Bloomberg showed.

The record increase in the foreign exchange reserves has taken place despite a decline in the gold reserves component by $2.59 billion to $113.81 billion during the week as gold prices fell.

An increase in the foreign exchange reserves reflects strong fundamentals of the economy and gives the Reserve Bank of India (RBI) more headroom to stabilise the rupee when it turns volatile.

A strong forex kitty enables the RBI to intervene in the spot and forward currency markets by releasing more dollars to prevent the rupee from going into a free fall.

Meanwhile, the RBI has announced a Rs 1 lakh crore open market operation (OMO) sale of government bonds to mop up the excess liquidity in the banking system that has resulted from the strong inflow of foreign currency.

The RBI will sell government securities worth Rs 1 lakh crore in three tranches — Rs 50,000 crore on September 17, Rs 25,000 crore on September 21, and another Rs 25,000 crore on September 28. The auctions will be conducted through the multiple-price method using a multi-security auction.

Earlier, the Reserve Bank had raised over Rs 3.53 lakh crore through an overnight Variable Rate Reverse Repo (VRRR) auction with a 1-day tenor on Monday, to absorb surplus cash from the banking system.

A VRRR auction is a monetary policy tool used by a central bank to absorb excess cash from the banking system and ensure financial stability in the economy.

The RBI has stepped up liquidity absorption operations as the banking system has been flooded with funds following large inflows through the special FCNR(B) deposit scheme.

RBI’s special dollar-rupee forex swap facility for FCNR(B) deposits, Overseas Foreign Currency Borrowings (OFCB) and External Commercial Borrowings (ECB), launched on June 8 this year, has driven an unprecedented surge in foreign exchange inflows into the country to the tune of $73 billion in less than 11 weeks of the launch.

The response was strong enough for the RBI to advance the closure of the FCNR(B) window itself, from September 30 to August 31, having already achieved its objective ahead of schedule.

Mumbai, Sep 12: The Indian equity benchmarks posted notable losses for the fifth consecutive week amid a sharp rise in crude oil and worries over global interest rates.

Nifty declined 2.09 per cent during the week and shed 0.34 per cent on the last trading day to reach 23,398. At close, Sensex was down 120 points, or 0.16 per cent, at 74,781. It lost 2.27 per cent during the week.

Analysts said that global macro developments weighed on investor sentiments. A firmer US inflation backdrop and rising Treasury yields — with the 10‑year US yield approaching the 5 per cent mark — reinforced expectations of a higher‑for‑longer rate environment and tightening global financial conditions.

The sell-off was broad-based, with major sectors ending lower during the week. Nifty realty emerged as the biggest loser on NSE down 6.54 per cent on a weekly basis. The Nifty IT index shed around 5.78 per cent during the week.

Indian equities saw sharp volatility due to the newly launched closing auction session, particularly on derivatives expiry days.

Crude oil emerged as the dominant headwind for domestic equities as attacks on tankers in the Strait of Hormuz intensified and Iran-aligned Houthi forces threatened oil shipments from the Red Sea region.

WTI Crude surged over 9.5 per cent moving above $104 per barrel, while Brent crude surged more than 8.5 per cent during the week.

Analysts noted that the crude price volatility has heightened India’s inflation risks and external-sector risks, with the potential to raise input costs and pressure corporate margins while reinforcing expectations of a higher-for-longer global interest-rate environment.

Broad market indices performed in line with the benchmark indices, as Nifty Midcap100 declined 1.40 per cent and Nifty Smallcap100 shed 0.94 per cent during the week.

The 23,300 zone remains the immediate support area for Nifty, while 23,500–23,600 region remains the immediate resistance zone.

Immediate support for Bank Nifty is placed around 56,200–56,000, while the 56,700–56,800 zone remains the key resistance area, market participants said.

Foreign institutional investors-led selling also emerged as another headwind for domestic equities. FIIs net sold Rs 1,795.19 crore worth of equities during the week, while domestic institutional investors (DIIs) net bought Rs 6,419.46 crore of equities.

Global macroeconomic and geopolitical risks are likely to keep Indian equities on edge in the week ahead, with crude oil prices, developments in the Middle East and shifting expectations for US monetary policy emerging as the key drivers of market sentiment, an analyst said.

Mumbai: Union Labour & Employment Minister Mansukh Mandaviya on Friday urged state governments to undertake a detailed assessment of the current utilisation of cess funds, identify gaps, and explore new avenues for their effective utilisation, keeping in view the long-term welfare and social security of workers.

Addressing the National Conference on Building and Other Construction Workers (BOCW) here, the minister also called upon states to undertake a comprehensive assessment of the impact of the Labour Codes after one year of their implementation and identify areas where more effective execution may be required. He emphasised the need for workshops and orientation programmes for labour law practitioners to facilitate effective implementation of the Codes in letter and spirit.

Highlighting the significance of the Pradhan Mantri Viksit Bharat Rozgar Yojana (PMVBRY) in promoting employment and expanding social security coverage for new entrants to the workforce, the minister urged state governments to undertake focused workshops and engagements with industry and other stakeholders. Such efforts, he noted, would help create greater awareness and ensure that eligible new entrants receive the benefits of the scheme, thereby strengthening the collective efforts towards expanding formal employment and worker welfare.

He stressed the importance of sharing best practices among states and ensuring optimum utilisation of BOCW funds to provide wider social security coverage to workers. He further emphasised the need for the labour ecosystem to continuously evolve with changing times, and underlined the need for the Centre and states to remain aligned in their vision and policies for the holistic welfare of BOCW workers.

He also emphasised the need to explore measures that can provide workers with greater dignity, honour and self-respect, including the possibility of providing pension support to workers. He further highlighted the growing global demand for skilled and semi-skilled workers, and underscored the need to prepare India’s workforce to meet these emerging opportunities.

Mandaviya called for deliberations on international labour mobility, highlighting its significance in the nation’s economic growth through remittances, and in meeting the aspirations of Bharat’s Yuva Shakti. He emphasised the need for coordinated efforts by the Centre and states to create a comprehensive platform for international labour mobility, supported by appropriate financial and digital infrastructure, so that Indian workers can access global opportunities while enhancing India’s credibility on the global stage.

In his address, Labour & Employment Secretary Dr Chandra Bhushan Kumar drew attention to the significance of the Conference, highlighting the number of construction workers across India, which stands at over 7 crore, and the BOCW cess corpus available in the country, amounting to about Rs 77,000 crore. The deliberations at the Conference provide an opportunity to share best practices and engage with industry partners, he added.