India, Japan finalise $75 billion currency swap agreement

NEW DELHI: As Prime Minister Narendra Modi wrapped up his fifth summit with his counterpart, Shinzo Abe, India and Japan concluded a $75-billion bilateral currency swap agreement , a move intended to bring greater stability to the rupee and capital markets in India.With greater strategic convergence coming into sharp relief, the two countries also agreed to start a "2+2" dialogue at the foreign and defence ministers' level as well as work together on infrastructure projects in Bangladesh, Myanmar and Sri Lanka, giving substance to Indo-Pacific policies.The swap agreement, a finance ministry release said, "will enable the agreed amount of foreign capital being available to India for use as and when need arises". In 2013, India and Japan worked out another swap agreement, increasing it from $15 billion to $50 billion, when the rupee had been under stress.An India-Japan vision statement issued after the summit-level meeting between the two leaders welcomed the swap agreement. An official said the currency swap agreement will have a positive impact on financing the current account deficit. "A strong signal to our financial and currency markets," Shaktikanta Das, a member of the 15th finance commission, tweeted.The summit, marked by a full day of informal meetings and deep conversations on Sunday, as well as delegation-level talks and industry outreach, saw the vision statement announce a "new era in India-Japan relations", which will enable them to "cooperate for peace, stability and prosperity of the Indo-Pacific.Based on their shared vision, the two Prime Ministers reiterated their unwavering commitment to working together towards a free and open Indo-Pacific. The two leaders also affirmed that Asean unity and centrality are at the heart of the Indo-Pacific concept, which is inclusive and open to all. They shared willingness to expand concrete cooperation with the US and other partners."In comments to the media, Modi said, "Without the cooperation of India and Japan, 21st century cannot be a century of Asia. Abe San and I have agreed to the '2+2 dialogue' between our foreign and defence ministers. Its purpose is to promote peace and stability in the world.""We both agree that from digital partnership to cyber space, from health to protection, and from sea to space, in every field we will strengthen our partnership," he added.India and Japan also exchanged a Notes and Loan Agreement for the second tranche of Japanese official development assistance loan for the Mumbai-Ahmedabad high-speed railway project. Modi appreciated Japan's role in promoting connectivity through quality infrastructure projects such as the Western Dedicated Freight Corridor and the Delhi-Mumbai Industrial Corridor. Japan is funding 80% of the Mumbai-Ahmedabad bullet train project through a soft loan of Rs 79,000 crore at an interest rate of 0.1%, with a tenure stretching over 50 years and a moratorium period of 15 years."The two leaders reaffirmed their shared commitment to the total elimination of nuclear weapons and remained resolute in the task of strengthening international cooperation to address the challenges of nuclear proliferation and nuclear terrorism," the statement said.They underlined the need for all countries to ensure that their territory is not used to launch terrorist attacks on other countries, in an apparent reference to Pakistan, which is accused by its neighbours of providing safe havens to terrorists.