Import Cover Definition

Import cover is a measure of a country's external stability and economic health. It represents the number of months of imports that a country can finance with its current international reserves (foreign exchange reserves, gold, etc.) without earning any additional foreign exchange. For example, if import cover is 8 months, it means the country has sufficient reserves to cover 8 months of imports. This indicator is closely watched by economists and policymakers as it reflects the adequacy of a country's external liquidity position. Option a describes the import intensity ratio, option b is just total imports value, and option c describes the export-import ratio. > Import Cover = Months of Imports Coverable by Reserves. Answer: d.