India Reinforces Economic Ties with New SAARC Currency Swap Framework

The Finance Ministry has introduced a new currency swap framework for SAARC countries, emphasizing India's commitment to regional economic cooperation. This includes an INR Swap Window worth Rs 25,000 crore, complementing the existing USD/Euro Swap Window, aimed at promoting the Indian Rupee's internationalization.

A day after the commerce ministry disclosed a record trade deficit of USD 37.8 billion for November, the Ministry of Finance announced new measures to enhance trade globally. A central initiative is the approval of a 'Framework on Currency Swap Arrangement for SAARC Countries 2024-27', a pivotal move in boosting South Asia's financial stability and economic collaboration.

In a social media update, the ministry explained, 'The Currency Swap Arrangement is designed to fortify economic bonds and ensure financial stability within the SAARC region, enabling member states to better manage their foreign exchange needs.' The framework replaces the former 'Currency Swap Arrangement for SAARC Countries 2019-22', aiding short-term forex demands of its members.

Highlighting a key feature, the ministry introduced an INR Swap Window worth Rs 25,000 crore, complementing the existing USD/Euro Swap Window of USD 2 billion. This plan seeks to further integrate the Indian Rupee into regional trade and financial operations, advancing its international role.

The SAARC Currency Swap Framework, initiated in 2012, plays a vital role in offering liquidity support to members during economic uncertainty. As part of the Global Financial Safety Net, it underscores India's dedication to enhancing SAARC economic relations and regional unity.

The Finance Ministry stressed that the revamped framework aims not only to fulfill the forex needs of SAARC nations but also to solidify India's status as a regional leader. By providing diverse currency swap options, the initiative is set to bolster trade and financial collaboration among SAARC nations, reaffirming India's economic leadership in South Asia. (ANI)

(With inputs from agencies.)