India and Japan signed a $75 billion bilateral foreign exchange agreement in October 2018. – The RBI also offers similar swap lines for central banks in the ASARC region for a total of $2 billion. India and Japan have also signed similar agreements in the past, but this is the largest bilateral agreement of its kind in the world. India already has a $75 billion bilateral sweatshirt line with Japan, which has the second largest reserve of dollars after China. The RBI statement of 29 March 2016 states that “the proposal to extend to Sri Lanka the additional exchange facility of $700 million for a limited period was adopted in March 2016, with the agreement of the EU government, for short-term liquidity management linked to India`s bilateral relations and strong economic relations with Sri Lanka.” Update of 31.07.2020: In July 2020, India introduced a $400 million foreign exchange swap mechanism in Srilanka under ASAC in Srilanka. Bilateral demand for a $1.1 billion swap is also under consideration. A bilateral currency exchange agreement is a currency exchange between two countries In the swap agreement, a country provides dollars to a foreign central bank which, at the same time, provides the corresponding resources in their currency for the first time, based on the exchange rate at the time of the transaction. The parties agree to exchange these quantities of their two currencies at some point in the future, i.e. the next day, or even two years later, using the same exchange rate as in the first transaction. The Reserve Bank of India (RBI) and the Bank of Japan have signed a bilateral swap agreement. The agreement was negotiated during Prime Minister Narendra Modi`s visit to Tokyo last year. Bilateral Swap Agreement The swap agreement will give India access to $75 billion against the $50 billion of the former BSA. Under..
The Indian High Commission in Colombo said the monetary agreement would be maintained until November 2022. In April, Sri Lanka said it was expected to reach an agreement with the RBI for a $400 million Swea exchange under the South Asian Association for Regional Cooperation (SAARC). In May, Sri Lankan President Gotabaya Rajapaksa asked India for a special monetary sweap mechanism of $1.1 billion. The agreement, valid until November 13, 2022, was signed as part of the South Asian Association for Regional Cooperation (SAARC) Currency Swap Framework 2019-22, the RBI said in a statement. According to its website, the RBI last signed a currency exchange agreement with the Central Bank of Sri Lanka in March 2016. Under the agreement, the Central Bank of Sri Lanka could make up to $700 million for up to three months. The facility is made available to all SAARC member countries, subject to the signing of bilateral swap agreements. The EU cabinet has given its ex post-de facto approval for the Memorandum of Understanding between the Reserve Bank of India (RBI) and the Central Bank of the United Arab Emirates (United Arab Emirates) regarding cooperation under the currency exchange agreement. The decision was taken at the EU cabinet meeting, chaired by Prime Minister Narendra Modi in New Delhi. ..
The saarc currency exchange framework came into effect on November 15, 2012 to provide a backstop financing line for short-term liquidity requirements or short-term balance-of-payments charges, pending the implementation of longer-term agreements.