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Russia asking India to pay

for oil in UAE dirhams

POLICY AS part of its dedollarisation efforts, Russia is according to sources, adding more would make
asking India to pay for oil imports in United such payments in coming days. The invoice seen
Arab Emirates (UAE) dirhams, Reuters reported by Reuters shows payments to be made to Gaz-
on July 20. prombank via Mashreq Bank, its correspondent
Russia’s international trade has been hit hard bank in Dubai.
by SWIFT sanctions that were imposed only The dirham is a convenient currency for both
days after Russia’s invasion of Ukraine in Febru- countries, and neither India nor the UAE have The dirham is
ary, which have made it very hard to use dollars. imposed sanctions on Russia. The central banks
An invoice seen by Reuters shows the bill for of India and UAE signed an agreement that a convenient
supplying oil to one refiner is calculated in dol- allows direct currency swaps.
lars, while payment is requested in dirhams. The There is also demand for dirhams in Russia as currency for both
Kremlin has been trying to force its partners to many of Russia’s wealthy have bought real estate
use currencies other than dollars in its energy in the UAE as an investment and the country has countries, and
trade. Russian President Vladimir Putin signed a become something of a playground for Russia’s neither India
decree setting up a gas-for-rubles scheme intro- rich.
duced in May that many countries have agreed The Central Bank of Russia (CBR) has already nor the UAE
to use. added the yuan to its currency basket and Rus-
India has become a major importer of Rus- sia holds the highest share of yuan in its gross have imposed
sian oil since sanctions were imposed together international reserves (GIR) of any country in
with China and has been buying billions of dol- the world. Now the CBR is intending to increase sanctions on
lars’ worth of oil. Russian oil major Rosneft is its reserves of dirham as well and intends to Russia.
selling its oil to India via trading firms including launch dirham trading on the Moscow currency
Everest Energy and Coral Energy, which is now exchange soon, as well as the Uzbek soum.
its second biggest oil buyer after China. Moscow India’s central bank last week introduced
replaced Saudi Arabia as the second biggest oil a new mechanism for international trade set-
supplier to India after Iraq for the second month tlements in rupees, which many experts see as
in a row in June, reports Reuters. a way to promote trade with countries that are
Reuters reports that at least two Indian refin- under Western sanctions, such as Russia and
ers have settled some payments in dirhams, Iran, reports Reuters.™

Week 29 22•July•2022 www. NEWSBASE .com P9