INTERNEWSTIMES.COM – India financial regulators are taking ameasured approach to expanding trade with Russia in rupee-rouble, a dance fraught with geopolitical complexities. While Russia is eager to boost bilateral trade in national currencies, India’s Reserve Bank (RBI) and Securities and Exchange Board (SEBI) are treading carefully.
The cautious stance is evident in the pending approval of several proposals from Sberbank AG, Russia’s largest bank. One such proposal, to export 100 tonnes of gold to India, was rejected by the RBI in March 2024, citing “supervisory concerns.”
The ECGC Ltd, India’s export credit agency, continues to classify Russia as “high risk,” despite Sberbank’s arguments that the risk of rupee-rouble trade is minimal. This cautious approach underscores the delicate balance India faces in navigating its economic relationship with Russia amidst geopolitical tensions.
While India seeks to maintain trade ties with Russia, it also needs to ensure compliance with international sanctions and safeguard its financial system. This “cautious waltz” reflects the complex dance between economic interests and geopolitical realities.
The article highlights several other hurdles to expanding rupee-rouble trade, including restrictions on Sberbank’s FPI license, its exclusion from the e-rupee pilot project, and difficulties for Russian stakeholders in accessing Indian government websites.
The future of rupee-rouble trade hinges on addressing these challenges. If successful, it could pave the way for increased trade in commodities, dividend payments to Indian companies, and a deeper economic partnership between the two nations. (Red)
