India's total foreign exchange (Forex) reserves stand at around US$572.771 Billion on 13 November 2020, the highest ever, the USD-INR exchange rate is USD1 = Rs.73.82 as of 26 November 2020 up from Rs.75. The RBI has also commented that “the recent appreciation of the rupee is working towards containing imported inflationary pressures". The forex reserve, the exchange rate, and RBI’s comment has raised important questions: are the growing currency reserves a sign of a healthy external balance? How are these reserves deployed currently, and could India use them more effectively to achieve growth and prosperity? Finally, with so much reserves, should we now let the rupee appreciate so that inflation softens and our wealth increases? India over the years has been a consumption-based economy with a Balance of Trade deficit. In COVID-19 times, there has been a huge surplus in the Current Account but are not sustainable in nature. In recent quarters India has managed to keep its BO...