Mumbai: India's foreign exchange reserves may deplete by $39 billion in fiscal 2008-09 as the global financial turmoil drains capital inflows into the country, global banker Goldman Sachs said in a report.

Foreign exchange reserves of the country, which stood at around $310 billion at the end of fiscal 2008, have been declining steadily and may reach $271 by the close of current financial year, the report said.

While ''capital inflows fell to $13.2 billion (in Q1 2008-09) from $25.4 billion in the previous quarter (Jan-March) and $17.3 billion in Q1 of 2007-08, the report attributed the decline mainly to the country's rising current account deficit. 

India's foreign exchange reserves declined to $292 billion as on 19 September due to a higher trade deficit and declining portfolio investment, latest RBI data showed.

While the decline in oil prices from the July heights have averted one of the biggest threats to the current account, with oil still ruling around $100 a barrel, the current account deficit will remain high during the year, the Goldman Sachs report said.

At $271 billion in March 2009, the country's forex reserves would be sufficient to meet 10.3 months of import bill, down from 15 months of imports in March 2008, it would be sufficient to fund the current account and external debt payments in the event of a sudden stop in capital flows, the report added.