The Reserve Bank of India (RBI) on Friday has entered into a Note Purchase Agreement with the International Monetary Fund (IMF) for subscribing to $10 billion worth of IMF notes. The agreement is a temporary bilateral arrangement for an initial period of one year, which may be extended by a period of upto two years, said RBI. RBI-IMF agreement a part of the international efforts to support the IMF?s lending capacity following the decision of the G-20 in its London Summit to treble the resources available to the IMF to $ 750 billion.
The IMF notes will be denominated in the special drawing right, Such notes shall be in multiples of SDR 10 million The amount of interest payble on each note is calculated on the basis of the principal amount of note. The interest accrues daily and is to be paid quarterly by the fund starting from April 30. Permanent increases in the resources of IMF are expected to take place through an increase in quotas and standing borrowing arrangements which are currently under negotiation among IMF and many other countries.
