Gulf News

In­dia-UAE cur­rency deal hailed

Pact ex­pected to re­duce de­pen­dency on hard cur­ren­cies like US dol­lar

- BY FAREED RAH­MAN Se­nior Re­porter

The cur­rency swap deal be­tween In­dia and the UAE will en­hance and strengthen trade re­la­tions be­tween the two coun­tries, a se­nior of­fi­cial from the Min­istry of Econ­omy told Gulf News.

“These agree­ments and up­com­ing agree­ments in many ar­eas will en­hance and strengthen trade re­la­tion­ships with In­dia,” said Juma Mo­ham­mad Al Kait, as­sis­tant un­der­sec­re­tary for for­eign trade af­fairs in the UAE’s Min­istry of Econ­omy.

In­dia and the UAE signed a cur­rency swap agree­ment on Tues­day to boost trade and eco­nomic re­la­tions.

Ben­e­fits

The agree­ment is ex­pected to re­duce the de­pen­dency on hard cur­ren­cies like the US dol­lar and give a push to the lo­cal cur­ren­cies of the two na­tions. It will also re­duce the im­pact of volatil­ity in ex­change rates aris­ing from the de­pen­dency on a third cur­rency, the In­dian em­bassy said in a state­ment.

The swap is for an amount of Dh2 bil­lion or Rs35 bil­lion, de­pend­ing on the cen­tral bank which is re­quest­ing the amount.

The sign­ing of the agree­ment took place fol­low­ing the visit of In­dia’s Ex­ter­nal Af­fairs Min­is­ter Sushma Swaraj to the UAE to hold dis­cus­sions with the top lead­er­ship to boost eco­nomic and trade re­la­tions be­tween the two coun­tries.

Cur­rently there are strong eco­nomic and trade ties be­tween In­dia and the UAE with trade stand­ing at $52 bil­lion in 2017, and non-oil trade ac­count­ing for $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. The two coun­tries are also co­op­er­at­ing in a big way in the en­ergy sec­tor.

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