In India, major banks are reluctant to enter into direct trade deals with Russia in rupees due to the possibility of falling foul of Western sanctions imposed in connection with the Ukraine crisis. This was reported today, October 10, by the Times of India, citing sources.

According to the publication, the use of the mechanism of mutual settlements with Russia in the national currency may constitute a violation of some of the provisions of these sanctions.

“They (Western countries) can impose sanctions on us, and it will be a loss for business and reputation,” quotes one of the Indian banking sources.

According to the source, the big banks do not want to use the mechanism of mutual settlements with the Russian Federation in rupees and rubles, “at least for now”. Indian financial institutions continue to trade with Russia in dollars and euros, but believe the switch to the rupee could attract Western attention and lead to sanctions. Another source explained that “the process of lifting the sanctions could take months, the banks do not want to take such a risk”.

Some interlocutors of the newspaper believe that “the lack of liquidity of the ruble against a background of more liquid rupee makes it difficult to exchange exchange rates accurately between the Russian and Indian currencies, which is another factor hindering the transition of Indian banks towards the trade”. in rubles and rupees.” Banks of the republic do not have significant assets in rubles and therefore cannot offer direct exchange in trade with the Russian Federation, quotes from a TASS publication.

The public bank UCO has received authorization to open a special account in rupees for the Russian bank Gazprom. In July, the Reserve Bank of India (Central Bank) requested domestic financial institutions to introduce additional mechanisms for import-export transactions in Indian rupees due to the growing interest of the global trading community in the currency. from the country.