India, Japan preparing currency swap agreement

NEW DELHI, India - India and Japan are negotiating a new currency swap agreement ahead of a visit to New Delhi by Japanese Prime Minister Yoshihiko Noda this week, a foreign ministry official said.

Japan's foreign reserves hit an all time high of $1.3 trillion in November, and a swap arrangement could help India support the rupee, Asia's worst performing currency this year.

Details of the arrangement are with the finance ministries and prime ministers of the two countries, India's joint secretary for East Asia, Guatam Bambawatle, said on Monday.

An earlier $3 billion arrangement came into force in 2008 but expired in June. The Nikkei business newspaper reported on on Sunday that the new one would be set at $10 billion.