BVR Subrahmanyam, Minister of Commerce of India expected This week, New Delhi will conduct trade with Russia and Sri Lanka worth as much as $9 billion over the next two months, Reuters reported on Wednesday.
“The rupee-denominated sales will be a huge advantage,” Subrahmanyam told reporters on August 2. “I expect trade with Russia and Sri Lanka to reach $8-9 billion in the next two months.”
India’s commerce minister refers to RBI’s July 11 decision allow Importers and exporters settle trade in rupees. The rupee is the currency of India, Sri Lanka, Pakistan, Nepal, Mauritius and Seychelles. The decision will facilitate easier trade between India and Russia and between India and Sri Lanka, as it allows foreign countries to transact in currencies other than the US dollar.
The dollar, on which the U.S. financial system depends based onhas dominated global trade transactions in recent decades, and often mentioned become the “world reserve currency”. This label stems from the fact that any economy that wishes to do meaningful business on the global stage must do so on a U.S. dollar basis.
The Reserve Bank of India’s decision last month to honour the Indian rupee-based deal showed New Delhi’s particular desire to trade with Russia as its economy is currently crippled by US-led financial sanctions imposed Moscow responds to its latest war with Ukraine. The financial sanctions campaign started on February 24, continue Today, targeting Russian companies and entities. The sanctions are notable for their secondary effects, including disrupting payment systems and shipping procedures that Russia has traditionally relied on for international trade.
“Although Russia’s oil exports have so far not been subject to Western sanctions, some international traders have avoided buying the oil due to disruptions to payment systems and shipping,” Reuters Observed May 25.
“In the period between the end of July and the Russian invasion of Ukraine on February 24, India’s imports from Russia, mainly crude oil, rose nearly fivefold from the previous year to $15 billion, according to a source with direct knowledge of the matter. Above.” Reuters reported on August 3.
“But exports fell to $852.22 million from $1.34 billion in the same period due to a lack of payment settlement mechanisms with sanctions-hit Russia,” the news agency said.
India’s expected trade with Sri Lanka over the next two months is likely to be a fraction of the estimated “$8-9 billion” trade that Subrahmanyam forecasts New Delhi will do with Colombo and Moscow on August 2. The relatively small island nation of Sri Lanka, off the southern coast of the Indian Ocean, has been in the midst of its worst financial crisis on record since early March. Colombo announced its decision to default on its foreign debt on April 12. The Sri Lankan government said at the time that it had requested “emergency financial assistance” from the International Monetary Fund (IMF). The International Monetary Fund said on June 3, Summarize The visit to Sri Lanka is part of its preparations for a formal response to Colombo’s request for economic relief “in the short term”.