The Union Cabinet has approved the new Framework on Currency Swap Arrangement for SAARC Countries 2024-27 on June 19, 2024, replacing the previous arrangement that was in place from 2019-22. This strategic initiative aims to strengthen economic ties, enhance regional financial stability, and address short-term foreign exchange requirements within the SAARC region.
The SAARC Currency Swap Framework, operational since its inception in 2012, offers a dependable funding line for member countries facing foreign exchange challenges. The new framework is designed to further promote regional cooperation, interdependence, and economic integration under the Global Financial Safety Net.
A key addition under the new framework is the introduction of a separate INR Swap Window worth ₹25,000 crore, alongside the existing USD/Euro swap window of $2 billion. This INR-focused measure is intended to encourage withdrawals in Indian Rupees, supporting the broader goal of INR internationalization.
By offering a strengthened and updated swap arrangement, India reaffirms its role in fostering financial security and economic resilience across the SAARC region.