The Reserve Bank of India (RBI) on Monday entered into a currency swap agreement with the Maldives Monetary Authority (MMA) under the SAARC (South Asian Association for Regional Cooperation) Currency Swap Framework 2024-27.
This comes in the backdrop of Maldives President Mohamed Muizzu’s ongoing India visit. “India Out” movement was the centre piece of Muizzu’s election campaign last year, leading to strained bilateral ties between the two countries.
Under the agreement, the MMA is eligible for financing support from the RBI amounting to $400 million under the US Dollar/ Euro Swap Window and ₹3000 crore under the INR (Indian Rupee) Swap Window, per a RBI statement. The agreement would be valid till June 18, 2027.
The SAARC Currency Swap Framework came into operation on November 15, 2012, to provide a backstop line of funding for short term foreign exchange liquidity requirements or short-term balance of payments stress till longer term arrangements are made.