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Saarc Currency Swap Agreement

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The Reserve Bank of India (RBI) has signed a currency swap agreement with the Central Bank of Sri Lanka, the Central Bank said on Monday. The Central Bank of Sri Lanka can draw US dollars, euros or Indian rupees in several tranches of up to a maximum of $400 million, or their equivalent under a currency swap arrangement, the RBI said in a press release. The agreement, valid until November 13, 2022, was signed as part of the South Asian Association for Regional Cooperation`s (SAARC) 2019-22 currency swap, the RBI said in a statement. The agreement signed under the saarc Currency Swap Framework 2019-22 would be valid until 13 November 2022. The SAARC currency swap framework entered into force on 15 Effective November 1, 2012, in order to provide a backstop funding line for short-term foreign exchange liquidity requirements or short-term balance of payments stress, until longer-term arrangements are concluded. The agreement signed under the saarc Currency Swap Framework 2019-22 would be valid until 13 November 2022. The framework provides for certain concessions for swap draws in Indian rupees, the RBI said. According to its website, the last time the RBI signed a special currency swap agreement with the Central Bank of Sri Lanka was in March 2016. Under the deal, the Central Bank of Sri Lanka could raise up to $700 million for up to three months. In the RBI statement of 29 March 27, 2016, it is stated that “the proposal to extend to Sri Lanka the additional monetary swap facility of $700 million for a limited period was adopted in March 2016, with the agreement of the Government of the Union, with a view to short-term liquidity management in the context of India`s close bilateral and economic relations with Sri Lanka”. Mumbai: The Reserve Bank announced on Tuesday that it has put in place a revised framework for currency swepts for saarc countries for 2019-2022.

As part of 2019-22, the Central Bank will continue to offer swap arrangements within the total corpus of $2 billion. The Facility shall be available to all SAAC Member States, subject to the signing of bilateral exchange agreements. In addition to India, the other member countries of the South Asian Association for Regional Cooperation (SAARC) are Afghanistan, Bangladesh, Bhutan, Maldives, Nepal, Pakistan and Sri Lanka. Last November, the RBI decided, with the agreement of the GOI, to put in place a revised framework for the swap arrangement for the period 2019-2022 for ASARC countries, with the aim of promoting financial stability and economic cooperation in the SAARC region. The framework will apply from November 14, 2019 to November 13, 2022. MUMBAI: The Reserve Bank of India (RBI) has signed a currency exchange agreement with the Central Bank of Sri Lanka, the Central Bank said on Monday. The Facility shall be available to all SAAC Member States, subject to the signing of bilateral exchange agreements. As part of 2019-22, the RBI will continue to offer swap arrangements within the total corpus of USD 2 billion. . .

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