Benaulim, Goa: Russia has accumulated “billions” of Indian rupees in trade but this is proving to be a problem, Russian Foreign Minister Sergey Lavrov said in Goa Friday.
Speaking to reporters on the sidelines of the Shanghai Cooperation Organisation (SCO) ‘Council of Foreign Ministers’ meeting, Lavrov was asked to respond to media reports that India and Russia have suspended talks to settle bilateral trade in rupees.
“This is a problem because we accumulated billions of rupees in accounts in Indian banks and we need to use this money. But for this, the rupees need to be transferred to another currency. This is being discussed now,” said the foreign minister.
The suspension of the rupee-rouble trade system between India and Russia is being viewed as a blow to Indian importers, who have been importing large amounts of cheap Russian oil since the start of the Ukraine war.
Reports indicate that importers were hoping for a permanent rupee-rouble payment mechanism to help lower currency conversion costs.
A rupee-rouble mechanism for trade between the two countries was established to avoid the purview of Western sanctions imposed on Russia over its invasion of Ukraine.
The sanctions imposed on Russia by the US have also meant that India cannot pay for Russian oil in US dollars, the conventional mode of payment used internationally.
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‘Boosting use of national currencies’
Speaking to reporters, Lavrov, however, added that there is an understanding among SCO member states about “boosting the use of national currencies” in order to avoid the “abuse” of the US dollar.
“We can use the practices that are currently being formed in the Eurasian Bank of Reconstruction and Development and the new BRICS Development Bank,” said Lavrov.
The New Development Bank (NDB), formerly known as the BRICS Development Bank, was the brainchild of India, which first proposed it at the 4th BRICS Summit in 2012 in Delhi.
At the SCO meet, Lavrov praised Brazilian President Luiz Inácio Lula da Silva’s call for the BRICS countries to move to national currencies (in order to end dollar dominance). He also said the prospect of creating an “aggregated currency” is being reviewed.
On Thursday, ahead of the SCO meeting, Lavrov and Indian External Affairs Minister S. Jaishankar held bilateral talks on the sidelines of the event. Asked whether the alleged drone attack on the Kremlin Wednesday was discussed with his Indian counterpart, Lavrov said the two didn’t discuss it “in detail” but added a caveat.
“We know the position of India which is in favour of stopping any provocation and any terrorist attacks. There’s no doubt about it,” he told reporters Friday.
The Russian foreign minister also praised China’s proposed 12-point peace plan for Ukraine, saying that it talks about refraining from actions that infringe on any other country and refraining from “illegitimate sanctions”.
“All this should be coordinated [and discussed] not with [Ukrainian President Volodymyr] Zelenskyy, who is a puppet in the hands of the West, but with his masters. We have always been ready for a dialogue like this,” he said.
(Edited by Anumeha Saxena)
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