About 

• SAARC is a regional intergovernmental organization established in 1985 with 7 founding members.
• SAARC now comprises eight Member States: Afghanistan (joined in 2007), Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan and Sri Lanka.
• The main objective of the Association include promotion of welfare of the peoples of South Asia and to improve their quality of life.
• Decisions at all levels are to be taken on the basis of unanimity; and bilateral and contentious issues are excluded from the deliberations of the Association.

• The Secretariat of the Association is located in Kathmandu, Nepal.

Why in News?

• The Reserve Bank of India (RBI) has put in place a revised Framework on Currency Swap Arrangement for SAARC countries for the period 2024 to 2027. 

• • Under the new Framework, a separate INR Swap Window has been introduced with various concessions for swap support in Indian Rupee. The total corpus of the rupee support is Rs 250 billion.
  • The RBI will continue to offer the swap arrangement in US dollar and Euro under a separate US Dollar/ Euro Swap Window with an overall corpus of $2 billion.
  • The Currency Swap Facility will be available to all SAARC member countries, subject to their signing the bilateral swap agreements.
  • The SAARC Currency Swap Facility came into operation in 2012 with an objective to provide a backstop line of funding for short term foreign exchange liquidity requirements or balance of payment crises of the SAARC countries till longer term arrangements are made.

• A backstop is a financial arrangement that creates a secondary source of funds in case the primary source is not enough to meet current needs.