India and Japan have renewed their $75 billion bilateral currency swap agreement, known as the Bilateral Swap Arrangement (BSA), to enhance economic stability and deepen financial cooperation between the two nations.

The agreement, which became effective on February 28, 2025, allows both countries to exchange their local currencies for US dollars when needed, providing a crucial financial safety net during times of economic uncertainty.

The RBI said that the size of the BSA will remain the same, up to 75 billion US dollars.

The Bank of Japan and the Reserve Bank of India signed the Second Amendment and Restatement Agreement of the BSA, maintaining the size of the swap arrangement at up to $75 billion.

This renewal is seen as a significant step in strengthening the economic ties between India and Japan, contributing to regional and global financial stability by complementing other financial safety nets.

The arrangement reflects the strong strategic partnership between the two countries and is expected to support India's efforts to maintain stability in its foreign exchange and capital markets.

Agencies