Cabinet approves $400 million currency swap arrangement for SAARC nations.

Highlights:

• The facility, Standby Swap, will help India provide a faster response to requests from SAARC member countries

• The RBI will negotiate operational details bilaterally with central banks of SAARC countries

The Union Cabinet on Wednesday approved amendments to the framework on currency swap arrangement for SAARC member countries by incorporating a stand-by facility of $400 million.

The facility would enable India to provide a prompt response to the current request from SAARC member countries for availing the swap amount exceeding the current limit prescribed under the SAARC Swap Framework.

The Reserve Bank of India (RBI) will negotiate operational details bilaterally with central banks of SAARC countries availing the Standby Swap, an official statement said.

"The Union Cabinet, chaired by Prime Minister Narendra Modi has given ex-post facto approval for amendment to the 'Framework on Currency Swap Arrangement for SAARC Member Countries' to incorporate a 'Standby Swap' amounting to $400 million operated within the overall size of the facility of $2 billion," the statement added.

Besides India, other members of SAARC grouping include Afghanistan, Pakistan, Sri Lanka, Bangladesh, Bhutan, Nepal and Maldives. (Source:Livemint)