The Reserve Bank Of India (RBI) on Friday signed a pact with the Central Bank of the United Arab Emirates (UAE) to enter into a Currency Swap Agreement, which is aimed at strengthening economic ties with the Gulf nation. The MoU was signed between RBI chief Raghuram Rajan and UAE’s Central Bank Governor Mubarak Rashed Al Mansoori.
India is UAE’s top trading partner while the latter is India’s third largest trading partner after the U.S. and China.
A currency swap (or a cross currency swap) is a foreign exchange derivative between two institutions to exchange the principal and / or interest payments of a loan in one currency for equivalent amounts, in net present value terms, in another currency.
So lets discuss about the questions related to this article which can be asked in the upcoming exam :
1. Currency Swap agreement has been signed between which two countries central bank ?
2. Who is the governor of the central bank of UAE ?
3. What is the name of the governor of RBI ?