The Reserve Bank of India's short dollar positions in the FX market have surged to a record high of $104 billion in March, according to data. This is in response to the threat posed by the Iran war. The bank's short-dollar forward book expanded by $26.5 billion month-on-month by the end of March. The size of the forward book had previously reached $88.7 billion. However, even if fundamentals improve, this could increase fresh dollar demand in the market. The RBI has also deployed rare regulatory measures to protect the rupee.