GoI Approves $50bn Swap with Japs

The Government of India today approved the enhancement of the bilateral currency swap arrangement between the Reserve Bank of India (RBI) and Bank of Japan from US$15 billion to US$ 50 billion. The terms of the Agreement have been agreed between the Indian and the Japanese side in this regard. The Government of India has authorized Reserve Bank of India (RBI) to sign the agreement.

This measure will further strengthen the bilateral financial cooperation between Japan and India.

Currency Swap Means

A currency swap is a foreign-exchange agreement between two institutions to exchange aspects (namely the principal and/or interest payments) of a loan in one currency for equivalent aspects of an equal in net present value loan in another currency. Currency swaps are motivated by comparative advantage. A currency swap should be distinguished from a central bank liquidity swap.