Foreign Exchange Reserves Sufficient for 19.1 Months of Merchandise and Services Imports

July 14, 2026 | Investopaper

The gross foreign exchange reserves increased 40.3 percent to Rs.3755.64 billion in mid-June 2026 from Rs.2677.68 billion in mid-July 2025. In US Dollar terms, the gross foreign exchange reserves increased 26.5 percent to 24.68 billion in mid-June 2026 from 19.50 billion in mid-July 2025.

Of the total foreign exchange reserves, the reserves held NRB increased 37.9 percent to Rs 3330.07 billion in mid-June 2026 from Rs. 2414.64 billion in mid-July 2025. Reserves held by banks and financial institutions (except NRB) increased 61.8 percent to Rs.425.57 billion in mid-June 2026 from Rs.263.04 billion in mid-July 2025. The share of Indian currency in total reserves stood at 21.5 percent in mid-May 2026.

Based on the imports of the eleven months of 2025/26, the foreign exchange reserves of the banking sector is sufficient to cover the prospective merchandise imports of 22.5 months, and merchandise and services imports of 19.1 months. The ratio of reserves-to-GDP, reserves-toimports and reserves-to-M2 stood at 61.5 percent, 159.5 percent, and 43.7 percent respectively in mid-June 2026. Such ratios were 43.8 percent, 128.1 percent, and 34.1 percent respectively in midJuly 2025.

Exports & Imports

During the eleven months of 2025/26, merchandise exports increased 12.3 percent to Rs.277.97 billion compared to a growth of 77.8 percent in the same period of the previous year.

Destination-wise, exports to India and other countries increased 13.6 percent and 9.2 percent respectively whereas exports to China decreased 35.8 percent. Exports of soyabean oil, palm oil, cardamom, noodles and brans among others increased whereas exports of zinc sheet, particle board, tea, woolen carpet and handicraft goods among others decreased in the review period.

Similarly, during the eleven months of 2025/26, mercandise imports increased 15.2 percent to Rs.1894.10 billion compared to a growth of 13.1 percent a year ago.

Destination-wise, imports from India, China, and other countries increased 11.8 percent, 21.5 percent, and 18.9 percent respectively. Imports of petroleum products, silver, transport equipment, vehicle and spare parts, chemical fertilizer, and crude soyabean oil among others increased whereas imports of edible oil, hot rolled sheet in coil, garlic, M.S. wire rod, bars, coils and M.S. billet among others decreased in the review period.

Total trade deficit increased 15.7 percent to Rs.1616.13 billion during the eleven months of 2025/26. Such a deficit had increased 6.3 percent in the corresponding period of the previous year. The export-import ratio decreased to 14.7 percent in the review period from 15.1 percent in the corresponding period of the previous year.

Custom-wise Foreign Trade (First 10 Months)

(Rs. in million)

Source: Based on customs data

Facebook

Tweet

Gmail