The trade mechanism between the rupee and the ruble could be ready as early as next week. India has been exploring alternatives to trade with Russia since the country was kicked out of the SWIFT communications system and lost access to numerous international currency exchanges.
A rupee-ruble trade pact, which would allow the nations to trade directly in each other's currencies, is one of the options being considered. The payment agreement might now be disclosed as early as next week.
The trading system might be launched next week, according to A Sakthivel, president of the Federation of Indian Export Organisations (FIEO). The FIEO is the government's apex trade promotion organization, representing the interests of 200,000 exporters.
Four to five banks would be chosen to participate in the trade, according to Sakthivel, and the banks will be chosen after meetings between the Reserve Bank of India governor, the finance minister, and the banks.
While Russia's bilateral trade with India is minimal, it is strategically important due to India's dependence on Russian military hardware and support.
Furthermore, as a result of the exodus of hundreds of western corporations from Russia as a result of ongoing sanctions, Indian businesses have a chance to establish themselves in the country. "We mainly export agriculture and pharmaceutical items to Russia. Now that the whole West has banned Russia, Indian companies would have a lot of opportunities to access Russia," Sakthivel added.
Crude oil, petroleum products, gold, other precious metals, precious stones, coal, fertilizers, and other items are all imported into India. As a result, the decision to cut Russia off from SWIFT will disrupt trade with India to some extent, particularly in fertilizers.
As a result, the government is once again looking into ways to set up a rupee payment mechanism for trade with Russia to mitigate the impact of Western sanctions.
