In order to enhance economic cooperation and strengthen financial stability, RBI has extended the currency swap arrangement to SAARC nations till mid November 2017.
- Under the arrangement, Swap Arrangement of US $ 2 billion both in foreign currency and Indian rupee to all SAARC member countries.
About RBI’s SAARC Swap Arrangement
On November 15, 2012, the then Governor of RBI, Dr. D. Subbarao announced the SAARC Swap Arrangement during the 24th SAARCFINANCE Governor’s Meeting in Pokhara, Nepal.
- SAARC member countries include – Afghanistan, Bangladesh, Bhutan, Maldives, Nepal, Pakistan and Sri Lanka.
- The swap has been offered in US dollar, Euro or Indian Rupee against the domestic currency or domestic currency denominated government securities of the requesting country.
- Under the facility, the requesting member countries can make drawls of US dollar, Euro or Indian Rupee in multiple tranches.
- Each drawl is of three months tenor and can be rolled over twice.
It was announced with a view to strengthening regional financial and economic cooperation which would pave the way for increased intra-regional trade, and contribute to enhancing our collective welfare.
About Reserve bank of India
Established in 1935, RBI is India’s central banking institution, which controls the monetary policy of the Indian rupee.
- RBI was nationalized on 1 January 1949.
- Headquarter – Mumbai, Maharashtra
- Current Governor – Raghuram Rajan