UAE and India sign currency swap deal to enhance trade

India and the UAE yesterday signed a currency swap agreement to boost trade and investment ties between the two countries.

The development came during the visit of Indian External Affairs Minister Sushma Swaraj to Abu Dhabi to take part in the ministerial meeting of the 12th session of the UAEIndia Joint Commission Meeting (JCM) and held exhaustive discussions with Shaikh Abdullah Bin Zayed Al Nahyan, minister of foreign affairs and international cooperation.

“Advancing the Comprehensive Strategic Partnership EAM @SushmaSwaraj & Foreign Minister Shaikh Abdullah Bin Zayed Al Nahyan co-chaired 12th India-UAE #JCM. Held exhaustive discussions on cooperation in energy, security, trade, investments, space, defence & consular, among others,” Raveesh Kumar, India’s external affairs ministry spokesperson tweeted.

He also said two documents were signed during the visit including an agreement on currency swap and Memorandum of Understanding (MoU) for Development Cooperation in Africa.

Through the currency swap agreement, India and the UAE can make payments in their respective currencies to boost trade and investment without the involvement of a third currency like the dollar. Clarifying the currency swap agreement the Indian embassy in Abu Dhabi said the swap is for an amount of Dh2 billion or rs35 billion depending on the central bank which is requesting the amount.

Currently there are strong economic and trade ties between India and the UAE with trade standing at $52 billion (Dh190.8 billion) in 2017, with non-oil trade accounting to $34 billion.

India’s FDI into the UAE last year was $6.6 billion while the UAE’s investment in India stood at $5.8 billion.