India’s investment in US bonds hit an all time high level in June at $73 billion

India by upping its exposure to United States (US) treasury by 19% over the past year is now among the 16 top lenders to the US, with its investments in the US government bonds hitting a new high in June at $73 billion.

Indian investors -predominantly the Reserve Bank of India (RBI) has now lent more than developed countries such as Canada, Germany or France to the world's most powerful economy. With this, India now accounts 1.2% of total foreign investments in US bonds of about $6 trillion as the country has parked more than a fifth of India's foreign exchange reserves of close to $320 billion in US government bonds. As per latest week report by RBI, the country's foreign exchange reserves fell to $319.35 billion as of August 8, compared with $319.99 billion the week earlier.

Further, reports suggest that country could further up its exposure in US treasury since the US is likely to be the first major country to raise rates in 2015. More importantly, also it is perceived to be a safe haven, particularly with the US economy now back on track.