Refer to the article " RBI: Price rise, geopolitical woes offset gains after 3rd wave ended" and answer the following questions:

1. Why the forex reserve is important for the economic growth of India?

2. Explain how foreign remittances affect global trading capability of a country.

3. In the aftermath of the Covid-19 there has lot of talk on self-dependence and localization of economies. How sustainable is this idea in Indian context, explain?

4. Rupee becoming weak against dollar in the current global turmoil is detrimental for the Indian economy. Explain why and what measure would you suggest to counter this.

RBI: Price rise, geopolitical woes offset gains after 3rd wave ended TIMES NEWS NETWORK shifts in risk sentiments and LOOMING HEADWINDS tightening of global financial Mumbai: The "State of the Forex reserves had hit a Forex reserves in pandemic conditions that could produce economy' report released by high of $6-42hm in Oct. but years (in Son) real economic consequences. the Reserve Bank of India have been declining since which may thwart Incipient (RBI) has said that the gains 607 from recovery in economic ac Some analysts expect the recoveries or even precipitate forex kitty to go below $610bn 32% rocketing inflation and econo- tivity after the third wave will micdownturns. be offset by Inflation, tighte RET's latest report warns The report is positive abo- ning financial conditions and external sustainability is curtailed by triple whammy 500 461 ut the country's ability to me terms of trade shock because of widening trade & current et the economic challenges as of the geopolitical situation. it is in a position of strength Even as some analysts feel account deficits along with capital outflows March 15. 72 due to vaccine coverage, f that the RBI's forex reserves mancial sector resilience and could fall below the sooo-bil adds continuing nepate recoveries, spike robust export and remittance lion mark (see graphic), the supply chain woes & inflation or cause downturns Inflows "Going forward, report warned that rapidly increased monetary policy > RBI said positives for India spurring private investment widening trade and current normallution are other are expanding vax coverage, a remains a key thrust area for account deficits co-existing headwinds for the economy resilient fin sector and strong sustaining growth on a durab with portfolio capital out- > These could together exports & remittances le basis, " the report said. The flows weigh on external susta report also said that the rise in inability Forex reserves stood "The near-term global out- the quickening pace of mone US bond yields and the anno- at nearly $507 billion as of look appears grim, caught up tary policy normalisation," uncement of a large govern- April 1 this year-a dipof mo- in a vortex of geopolitical the report said. It added emer- ment borrowing programme re than $35 billion from a high risks materialising rapidly ging market economies are have put upward pressure on of $612 billion in October 3021. strained supply chains and bracing to contend with swift bond yields in India.RBI: Price rise, geopolitical woes offset gains after 3rd wave ended LOOMING HEADWINDS