India and Japan have decided to expand their currency swap arrangement from $15 billion to $50 billion to strengthen bilateral financial cooperation and stabilise the global and emerging economy financial markets.
The decision to expand bilateral currency swap was taken at a meeting between Prime Minister Manmohan and Japanese deputy prime minister Taro Aso on the sidelines of the G-20 summit here.
The two sides also reiterated the importance of continued reforms in financial and investment sectors for promoting stable and long-term capital flows into India.
These policy measures are also intended at strengthening bilateral financial cooperation between Japan and India.
The decision comes a day after Manmohan Singh called for extensive consultations within the G-20 grouping to tackle the current crisis in the financial markets.
India, with its high current account deficit, has particularly been affected by currency volatility and was fighting hard to maintain foreign capital inflows in a not so friendly environment.