Posted on 05/07/2023 9:35:16 PM PDT by Cronos
Russia has billions of rupees sitting in Indian banks but acknowledged there's a problem as it looks for ways to convert that currency.
Foreign Minister Sergei Lavrov noted the widening trade deficit with India, which has been a top buyer of Russian oil since Moscow launched its war on Ukraine last year.
"As for rupees, this is a problem because there are billions of rupees accumulated in accounts at Indian banks and we need to use this money," Lavrov told reporters in India on Friday. "For this, rupees should be converted into other currencies. This is being discussed."
The comments come a day after Reuters reported that Russia and India have suspended negotiations over using rupees for trade between the two countries.
Russia prefers to be paid in Chinese yuan, which has become the most-used foreign currency in Russia. Meanwhile, Moscow has reportedly been hesitant about using the rupee due to exchange-rate volatility.
...Still, Russia and India remain deadlocked in a currency dispute that has also frozen weapons sales between the two countries.
India won't pay Russia in US dollars over concerns that it may face secondary sanctions and won't pay in rubles because of worries about obtaining Russia's currency on global markets at a fair rate, sources told Bloomberg last month.
Meanwhile, Russia won't take Indian rupees because of exchange-rate volatility, the report added. Moscow has also rejected an idea from New Delhi for the Kremlin to invest rupees from arms payments back into Indian capital markets so the currency doesn't pile up.
(Excerpt) Read more at finance.yahoo.com ...
Without a Global Reserve Currency - trade will devolve into Gold and Barter.
buy gold
everyone takes that.
Maybe they should just buy Gold in India with their Rupees? One thing I saw quite often in India was anyone with some extra Rupees on hand and a mobile phone, checking the price of grams of gold in real time and buying physical when they thought the price was right. Indians with money don’t seem to want Rupees until they need them.
How can they do that? India has strict currency controls. That money is stuck in Rupees. The Russians will have to spend it in India.
It turns out you are right. Russia and India are in discussions about this. But as of now, Russia cannot easily convert Indian Rupees to dollars and Euros. Russia is stuck with Rupee stockpiles worth tens of billions of US Dollars.
Russia was so eager to market/unload their oil, that they struck ridiculous terms of payment with India
Kazan - isn’t that the capital of Tatarstan, part of the Russian federation?
How’s the weather in Kazan, Russia?
This is going to be interesting to watch. I’m not convinced
I know what is going to take place, but I like our models
much better than other people’s models.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.