India's foreign exchange reserves rose by over $8.223 billion during the week ended June 5 to cross the $500 billion magic mark for the first time ever. According to the RBI's weekly statistical supplement, forex reserves increased to $501.703 billion from $493.480 billion for the week ended May 29.

India's forex reserves comprise foreign currency assets (FCAs), gold reserves, special drawing rights (SDRs) and India's reserve position with the International Monetary Fund (IMF).

On a weekly basis, FCAs, the largest component of the forex reserves, edged higher by $8.422 billion to $463.630 billion. However, the value of the country's gold reserves decreased by $329 million to $32.352 billion. Besides, the SDR value rose by $10 million to $1.442 billion. The country's reserve position with the IMF increased by $120 million to $4.278 billion.

In a tweet, Mahindra Group chairman, Anand Mahindra said: "30 yrs ago India had almost run out of forex. Now we have the 3rd largest global reserves. In these uncertain times this news is a morale booster. Let’s not forget our country’s potential & let’s use this resource wisely to get back on the growth path."

India has overtaken Russia and South Korea to become the third-biggest holder of reserves after China and Japan.

Multiple reasons have contributed to the increase. Foreign exchange reserves have touched a magic figure of half trillion due to strong equity flows and foreign direct investment deals. Decline in global crude oil prices too helped in shoring up forex reserves..