Currency Swap Agreement

Currency Swap Agreement

RBI announces SAARC Currency Swap Framework for 2024-2027

  • A separate INR Swap Window has been introduced with various concessions for swap support in Indian Rupee (Total corpus of the Rupee support is ₹250 billion).
  • RBI will continue to offer swap arrangement in USD and Euro under a separate US Dollar/ Euro Swap Window with an overall corpus of US$ 2 billion.
  • A contract under which 2 counterparties agree to exchange two currencies at a set rate and then to re-exchange those currencies at an agreed upon rate at a fixed date in future.
  • Objectives of CSA –
    • To meet short term foreign exchange liquidity requirements
    • To ensure adequate foreign currency to avoid Balance of Payments (BOP) crisis till longer arrangements can be made.
  • BRICS Contingent Reserve Agreement signed in 2015.
  • India-Japan bilateral CSA
  • India-UAE CSA
  • India-Sri Lanka CSA

Related Article: SAARC

Source: RBI


Previous Year Question

‘Global Financial Stability Report’ is prepared by the:

[UPSC Civil Service Exam – 2016 Prelims]

(a) European Central Bank
(b) International Monetary Fund
(c) International Bank for Reconstruction and Development
(d) Organisation for Economic Cooperation and Development

Answer: (b)


Practice Question

Consider the following:

  1. Japan
  2. UAE
  3. Sri Lanka

India has Currency Swap Arrangements with how many of the above countries?

 
 
 
 

Question 1 of 1

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