Indian and United Arab Emirates signed a currency swap agreement on Tuesday for enhancing the trade and investment partnership between the two countries. The agreement was signed post the 12th edition of India-UAE Joint Commission Meeting for Economic and Technical Cooperation.
The Agreement signed will facilitate trade between India and UAE without the use of international currencies. According to an official statement, the swap is will be of INR 3500 crore or 200 crore dirhams, close to $500 million, depending on the central bank that requests the amount. The official statement said, “The bilateral currency swap agreement between India and the UAE is expected to reduce the dependency on hard currencies like the U.S dollar”, adding that the swap would result in risk reduction in terms of exchange rate fluctuation.
India and UAE enjoy strong trade relations, with last year’s bilateral trade standing at $52 billion, out of which $34 billion amounted to non-oil trade. Apart from this, India’s 2017 Foreign Direct Investment into the UAE was over six billion dollars, while the UAE invested over five billion dollars in India.
The 12th India-UAE Joint Commission Meeting in Abu Dhabi was co-chaired by Indian Foreign Minister, Sushma Swaraj and her UAE counterpart Sheikh Abdulla bin Zayed al Nahyan.