RBI renews Bilateral Swap Agreement with Bank of Japan to foster economic ties

New Delhi: With a strong emphasis and maintenance on strategic and global partnership between the two nations, the Japan and India had renewed the Bilateral Swap Arrangement (BSA) effective from February 28, 2026. The renewal is expected to strengthen the financial stability, deepen the economic ties, and would enhance the liquidity partnership between the countries.

The Bank of Japan, acting as the agent for the Minister of Finance, Japan, and the Reserve Bank of India signed the third Amendment and Restatement Agreement of the BSA, according to the statement issued by the RBI.

The BSA is a two-way arrangement where both authorities can swap their local currencies in exchange for the US Dollar. The size of the BSA remains unchanged, that is, up to 75 billion US Dollars.

Further, Japan and India believe that the BSA, which aims to strengthen and complement other financial safety nets, will further deepen financial cooperation between the two countries and contribute to regional and global financial stability.

Through this two-way facility, it will allow both the nations to swap local currencies for US-dollar while ensuring stability against strong capital outflow and magnifying economic peer strength.