The Central Bank of India is consulting with Russia on the transition to settlement in rubles and rupees. This will allow it to buy Russian energy products after restrictions due to Western sanctions on the use of payment mechanisms in the Russian Federation, informs Financial Times, citing an informed banker.
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It is noted that the Reserve Bank of India (RBI) is consulting with the government and state-owned banks of Russia to assess the scale of necessary payments in rupees and rubles and which banks will be able to make it.
The President of the Federation of Indian Export Organizations (FIEO) confirmed the talks between the countries to the publication.
“We have asked the government to set up this mechanism. So the government is working on it. Very soon, I think we will get it,” said A. Sakthivel, president of FIEO, to the Financial Times.
The Indian Ministry of Finance and the State Bank of India declined to comment.
The final decision on the transition to recalculations for energy carriers of the Russian Federation in rupees and rubles remains with the government.
The president of the Indian Business Alliance in Russia, Sammy Kotwani, roughly described a possible mechanism as follows: “I can give rubles to Sberbank, and they can give me rupees in India.”
In the past, India has used local currency mechanisms to circumvent Western sanctions. This mechanism allowed Indian companies to buy Iranian oil, bypassing US sanctions against Tehran.
A spokesman for the foreign trade department also told the publication that the rupee-ruble agreement could provoke a furious reaction from the US, which is India’s largest export destination, buying more than $50 billion worth of Indian goods a year.
- Leaders of the European Commission, France, Germany, Italy, UK, Canada and the US announced sanctions against the Central Bank of the Russian Federation and disconnected several of its creditors from the SWIFT financial messaging system.
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