Sri Lanka will conclude a $400 million bilateral agreement with the RBI, Gunawardena said, adding that the RBI facility was aimed at increasing the island state`s foreign exchange reserves. India and Japan signed a $75 billion monetary sweavision agreement during Prime Minister Narendra Modi`s visit to Japan, as announced by the government on Monday. “During Prime Minister Modi`s visit to Japan, the prime ministers of India and Japan agreed on a $75 billion bilateral sweatshirt agreement to further strengthen and expand the depth and diversity of economic cooperation,” the Indian government said in a statement. A currency swea usually involves the exchange of interest and sometimes capital in a currency for the same currency. Interest payments are exchanged on fixed dates during the term of the contract. It is considered a foreign exchange transaction and is not legally required to be registered on a company`s balance sheet. “The swap agreement should help stabilize India`s foreign exchange and capital markets,” the government said. This regime would further improve India`s prospects for foreign capital exploration to meet the country`s development needs. This facility will allow India to provide the agreed amount of foreign capital as soon as necessary. While the RBI had accumulated foreign exchange reserves of more than $426 billion until April 2018, it had to find some of it in recent weeks to support the rupees.
Although the current foreign exchange reserves of more than $390 billion are still comfortable, a $75 billion loan from Japan gives the RBI an additional buffer that it can use if it needs additional dollars. China and Japan also use bilateral sweatshirts as instruments to combat the hegemony of the dollar, as it encourages more countries to use their currencies to pay their bills. New Delhi: India is considering a $1.1 billion currency swap deal with Sri Lanka as the island state looks at debt management with India and China, ThePrint has learned. According to the Government, the foreign exchange agreement is an important step in improving confidence in the Indian market and would not only provide agreed capital to India, but also reduce the cost of capital for Indian companies while having access to the foreign capital market. A currency swea is a transaction in which two parties exchange a corresponding amount of money, but in different currencies.