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RBI Revises SAARC Currency Swap Framework for 2024-2027

Published on June 28, 2024
Current Context: The Reserve Bank of India (RBI) has introduced a revised Framework on Currency Swap Arrangement for SAARC (South Asian Association for Regional Cooperation) countries, covering the period from 2024 to 2027.
RBI Revises SAARC Currency Swap Framework for 2024-2027
  • Here are the key points:
    • INR Swap Window: The RBI has established a new INR Swap Window with various concessions for swap support in Indian Rupees. The total amount available under this facility is ₹250 billion. This move aims to enhance financial cooperation among SAARC countries by providing easier access to Indian Rupees.
    • USD/Euro Swap Arrangements: Besides the INR Swap Window, the RBI will continue to offer swap arrangements in US Dollars and Euros through a separate US Dollar/Euro Swap Window. The overall amount available under this facility is USD 2 billion.
    • Purpose: These agreements serve as a safety net for short-term foreign exchange liquidity needs or balance of payment crises in SAARC countries until more permanent solutions are established.
  • The Currency Swap Facility is available to all SAARC member countries, provided they sign bilateral swap agreements with the RBI.
  • This framework aims to strengthen economic ties and provide financial stability within the SAARC region, helping member countries manage their foreign exchange needs more effectively.

Question:

1 What is the total amount available under the new INR Swap Window established by the RBI for SAARC (South Asian Association for Regional Cooperation) countries?

  • A) 100 billion
  • B) 250 billion
  • C) 270 billion
  • D) 300 billion
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