Currency swap agreement between India and Japan approved

New Delhi, Mar 27 The Union Cabinet today gave its approval for authorizing the Reserve Bank of India (RBI) to sign the proposed Currency Swap Agreement with the bank of Japan to exchange an amount of three billion dollar against the respective domestic currency for mitigating short term Balance of Payment (BOP) problem.

The actual draw down will be affected by RBI when the Government judges that it should be drawn down, after consulting RBI.

It is an additional arrangement outside IMF to meet for short-term liquidity in dollars during a Balance of Payment crisis.

It is a cost effective tool of achieving the strategic objective of demonstrating regional cooperation.

ANI