RBI Transfers 100 Metric Tonnes of Gold from UK to Domestic Vaults

3rd June 2024- The Reserve Bank of India (RBI) has successfully repatriated 100 metric tonnes of its gold reserves from the United Kingdom to domestic vaults in FY24. This significant transfer is one of the largest movements of gold by India since 1991. Before this move, the RBI held approximately 500 tonnes of gold abroad and 300 tonnes within India. With the repatriation, the gold reserves are now evenly split, with 400 tonnes each in India and abroad.

Sources within the RBI clarified that the primary motivation behind this transfer is logistical and strategic rather than geopolitical. The central bank aims to maintain a portion of its gold reserves abroad for gold swaps and trading purposes but sees no need for a substantial amount to remain outside the country.

The RBI has significantly increased its gold purchases, acquiring one and a half times more gold in the first four months of 2024 than in the entire previous year. In FY24, the RBI added 27.47 tonnes of gold to its reserves, bringing the total to 822.1 tonnes, up from 794.63 tonnes the previous year. This move aligns with the RBI’s broader strategy to diversify foreign exchange reserves and hedge against inflation and currency volatility.