RBI rolls out new SAARC currency swap framework for 2024 to 2027

Mumbai: The Reserve Bank of India (RBI) announced on Thursday that it has, with the concurrence of the government of India, decided to put in place a revised Framework on Currency Swap Arrangement for SAARC countries for 2024 to 2027.

Under this Framework, the Reserve Bank of India would enter bilateral swap agreements with the central banks of SAARC countries, who want to avail of the swap facility.

The SAARC Currency Swap Facility came into operation on November 15, 2012 with an intention to provide a backstop line of funding for short term foreign exchange liquidity requirements or balance of payment crises of the SAARC countries till longer term arrangements are made.

Under the Framework for 2024-27, a separate INR Swap Window has been introduced with various concessions for swap support in Indian Rupee.

The total corpus of the rupee support is Rs 250 billion.

The RBI will continue to offer the swap arrangement in US dollar and Euro under a separate US Dollar/ Euro Swap Window with an overall corpus of $2 billion.

The Currency Swap Facility will be available to all SAARC member countries, subject to their signing the bilateral swap agreements.

Apart from India, the other SAARC member countries are Afghanistan, Bangladesh, Bhutan, Maldives, Nepal, Pakistan and Sri Lanka.