India’s foreign exchange reserves rose by $2.362 billion to $703.308 billion in the week ended April 17, the Reserve Bank of India (RBI) said on Friday. This comes after the kitty had already gained $3.825 billion in the previous week, when the reserves stood at $700.946 billion.The reserves had earlier touched a record high of $728.494 billion in the week ended February 27. After that, they declined in the following weeks as the Middle East conflict, which began around February 28, intensified. The geopolitical tensions during this period put pressure on rupee, prompting the RBI to step in and sell dollars in the forex market.In the latest week, foreign currency assets, the biggest part of the reserves, increased by $1.481 billion to $557.463 billion. These assets are affected by changes in the value of currencies like the euro, pound and yen.Gold reserves also went up by $790 million to $122.133 billion.Meanwhile, special drawing rights (SDRs) rose by $78 million to $18.841 billion. India’s reserve position with the International Monetary Fund (IMF) also increased by $14 million to $4.87 billion, the RBI data showed.The apex bank stepped up its dollar purchases in February, indicating a move towards rebuilding foreign exchange reserves after the rupee stabilised following the US–India trade deal announcement earlier in the month.Even with strong buying in the spot market, net forward sales stood at $77.7 billion, showing that the central bank continued to depend on forward market operations. While February offered some room to add to reserves, a large portion of those gains was later eroded in March when the rupee came under pressure after the US-Iran conflict began on February 28.Data from the RBI’s April Bulletin showed the central bank was a net buyer of $7.4 billion in the over-the-counter (OTC) market. It purchased $21.4 billion and sold $14 billion during the period, which led to a liquidity injection of Rs 66,881 crore into the system.In the futures market, the RBI maintained a neutral stance with no net intervention, while slightly reducing its outstanding net sales position to $522 million.