Japan, India expand currency swap arrangement to $50 BIllion

Japan and India on Friday expanded an arrangement for swapping their local currencies against the US dollar, raising the size to as much as USD 50 billion from the original USD 15 billion.

The expanded swap arrangement, signed by Bank of Japan Governor Haruhiko Kuroda and his Indian counterpart Raghuram Rajan, will be effective until December 2015, the BOJ said in a statement on Friday.

The swap arrangement aims to counter any short-term liquidity problems the two countries may face in future. "This expansion of the bilateral swap arrangement will contribute to the stability of global financial markets including emerging economies," the BOJ statement said.

Japan, India expand currency swap arrangement to $50 BIllion

Anyone tell me why there would be an arrangement only till 2015... any in-house economists which has an idea ?

Also the Japanese PM has been invited for India's Republic Day Parade on 26th Jan which is usually reserved for the closest of allies

reply to post by maddy21


Japan-India ties are looking up for sure, and it makes a lot of sense.

However we must be careful in reading too much. India MUST build its strength, both economically and militarily, if the country has to stand up and get respect.

A lot of countries will become friends if India is strong.

India is now a key part of Japan's overseas industrial base. India is also a large market for Japan's products.

As regards the duration of the deal, such things always get extended.