New Delhi, Dec 19 (KNN) In an effort to strengthen financial cooperation between Japan and India, a bilateral currency swap agreement has been signed by the central banks of both the countries.
“On 18.12.2013, RBI Governor Raghuram Rajan signed on behalf of the Reserve Bank of India the Agreement on bilateral currency swap arrangement between RBI and Bank of Japan,” said Union Finance Minister P Chidambaram here today.
Under the Agreement, the facility of currency swap has been enhanced from USD 15 billion to USD 50 billion. Earlier, the terms had been agreed between the Indian and the Japanese sides and the Government had authorized RBI to sign the Agreement.
“The government believes that this measure will further strengthen the bilateral financial cooperation between Japan and India,” Chidambaram said.
The agreement will help both countries to swap Japanese yen or the Indian rupee for US dollars in unforeseen circumstances, while helping them tide over short-term foreign exchange crunch.
According to reports, the deal was first signed in 2008 and was limited to USD 3 billion, but the size was increased to USD 15 billion when the arrangement was renewed in 2011.