Robust trade flows and remittances by expatriates helped India's foreign exchange reserves rise for the 15th straight week to a record high, analysts said after the central bank released the latest data on Saturday.

The Reserve Bank of India said the country's pile of foreign currency assets grew by $1.084 billion to $74.667 billion in the week to February 7. It was the biggest weekly jump this financial year that ends on March 31.

In that week, the rupee notched a 16 1/2-month closing peak of 47.7000/7025 to a dollar, gaining 0.2 per cent in five trading days.

Analysts said the country's foreign exchange reserves have been rising on the back of resurgent exports and repatriations by overseas Indians in a weakening dollar environment. Additions in 2003 alone aggregated more than $4 billion.

Exports in April-December 2002, the first nine months of the financial year to March, rose 20.36 per cent from the same period of the previous financial year. Forex reserves jumped by over $16 billion in that period.

Earlier this month, the country's strong external position prompted international ratings agency Moody's Investors Service to upgrade India's foreign currency debt and issuer rating to Ba1, the top of the speculative grade, from Ba2.

And despite a spike in prices of oil, India's biggest import, which rose to a two-year high on Friday, analysts were not worried because they expect strong dollar supplies.

"Even if oil stays here for an entire quarter, I don't see an external financing problem," said Kishalay Pathak, regional economist at Standard Chartered.

Peak inflows

Analysts said foreign currency inflows were traditionally the highest in the last quarter of the financial year to March because miscellaneous receipts in the balance of payments account tend to peak out in that period.

But additions to reserves may not keep pace, they said.

"Although, the fourth quarter is seasonally the best for inflows, I am looking at foreign exchange reserves in the vicinity of $77.5 billion by March-end," said Pathak.

"The central bank is not buying (dollars) as much as it used to and corporate hedge ratios are not as skewed towards net forward sold positions as in the past."

Besides the central bank's forex purchases, India's foreign currency assets also fluctuate with changes in the value of other currencies held in its reserves, like the euro, sterling and yen.

And despite expectations of rising corporate dollar demand, analysts expect the rupee to continue gaining against the dollar.

The rupee has appreciated by 0.3 per cent so far in 2003, after rising by 0.55 per cent in 2002, when it gained against the dollar for the first time in a decade.