New Delhi, March 3
State Bank of India has issued a circular, stopping the processing of transactions of Russian entities that have been sanctioned by the US and its allies.
The circular has been issued as the country’s largest bank fears that transactions with sanctioned Russian banks and institutions could invite sanction.
The Indian banks have also to contend with the EU, US and some other nations barring Russian banks from the SWIFT inter-banking system. No transactions involving entities, banks, ports or vessels appearing on the US, European Union or United Nations sanctions list would be processed, irrespective of the currency of the transaction. Payments due to Russian entities have to be processed by other mechanisms rather than through the banking channel.
Circular issued
- SBI has stopped processing transactions of Russian entities sanctioned by the West over Ukraine invasion
- Bilateral trade between India and Russia stood at $9.4 bn so far this fiscal as against $8.1 bn in 2020-21
The SBI operates a joint venture in Moscow called Commercial Indo Bank Llc, where Canara Bank is another partner with 40 per cent stake.
Russia is one of biggest suppliers of defence products and equipment to India, mostly under government-to-government contract.
Bilateral trade between India and Russia was at $ 9.4 billion this fiscal as against $8.1 billion in 2020-21. India’s main imports are fuels, mineral oils, pearls, precious and semi-precious stones, nuclear reactors, boilers, machinery and mechanical appliances, electrical machinery and fertilisers.
The major export items from India to Russia are pharma products, electrical machinery and equipment, organic chemicals and vehicles. In the past too, India had circumvented similar US-led sanctions to pay for imports from Iran.
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