Currency Swap Arrangement
- Posted By
10Pointer
- Categories
Economy
- Published
27th Jul, 2020
-
- The Reserve Bank of India has agreed to a $400 million currency swap facility for Sri Lanka till November 2022.
- CSA is an arrangement between two friendly countries to involve in trading in their own local currencies.
- As per the arrangements, both countries pay for import and export trade at the pre-determined rates of exchange, without bringing in third country currency like the US Dollar.
- In such arrangements no third country currency is involved, thereby eliminating the need to worry about exchange variations.
- Bring down the cost of capital for Indian entities while accessing the foreign capital market.
- Aids in bringing greater stability to foreign exchange and capital markets in India.
.PNG)
