First, adequacy has to be viewed not only in terms of trade needs but also other short-term liabilities. Secondly, it is not merely the long-term or short-term debt in terms of original maturity that is relevant for reserves, but the residual maturity. Thus, in managing the capital account, the maturity profile of debt, including short-term debt becomes important.
Thirdly, a trade-related debt which is in the nature of collateralised debt may be less severe on reserve-requirements. Fourthly, any addition to portfolio-flows may warrant comfort through some additions to reserves, which implies that the net contribution to investment in the country through portfolio flows is, in effect, less than what the magnitudes indicate.