• UGI USER
  • Jul 16, 2024
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INDIA AND RUSSIA BOOST RUPEE-ROUBLE PAYMENTS AMID SANCTIONS

Why in the news?

  • India and Russia have significantly increased their transactions in rupees and Roubles, doubling payments in 2024 despite US and EU sanctions.
  • Sberbank reports a 80% increase in transactions handled in the first half of 2024.
  • Indian corporate rupee deposits have surged sixfold since the beginning of the year.
Source: HT

Economic Ties:

  • Focus areas include secure payment mechanisms, insurance, logistics, and sectors like auto components, chemicals, and medical devices.
  • Both countries aim to achieve a $100 billion trade target by 2030.
  • Chinese trade with Russia already stands at $240 billion annually, highlighting competitive challenges.
About Rupee-Rouble Agreement:

  • The Rupee-Rouble mechanism is a payment arrangement allowing settlements in Indian rupees and Russian roubles.
  • It was established in 1953 as part of the Indo-Soviet trade agreement.
  • This mechanism provides an alternative to using US Dollars or Euros for trade settlements between India and Russia.
  • It aims to facilitate bilateral trade by reducing dependency on foreign currencies.
  • Transactions under this arrangement are conducted directly in the national currencies of India and Russia.

Associated Article:

https://universalinstitutions.com/will-rupee-trade-gain-currency-globally/