The talk of dealing in rupees with Russia collapsed

- Russia showed willingness to accept payment in rupees so India increased imports from Russia and started buying in bulk

- The shocking thing for India is that Russia is getting sick of taking payments in rupees but doesn't mind taking payments in Chinese Yuan. The reason is that Russia's trade with China has become huge. China gives very cheap goods to the whole world and also gives cheap goods to Russia. Due to this, Russia will buy more goods from China. For that he needs more Chinese Yuan. Countries including India should pay in Chinese Yuan, the balance should be given to China. Russia is interested in the yuan so it doesn't have to use its own rubles to buy yuan.

India and Russia have been at a standstill for a long time in terms of dealing in rupees. After Russia's invasion of Ukraine, relations between India and Russia deepened, and negotiations began to denominate commercial transactions between the two countries in their respective currencies. Meaning, India pays in rupees for goods it buys from Russia while Russia pays in rubles for goods it buys from India.

A year ago Russia did not find anything objectionable in this arrangement but now after a year Russia does not want Indian rupees. Due to this, Russia has given up at the end of these negotiations that have been going on for a long time.

Russia has clearly told India that instead of Indian rupees, it is possible to do transactions in any other currency, including UAE dirham or Chinese yuan, but it does not want Indian currency. Due to Russia's attitude, the talk of trading in each other's currency has been completely abandoned. Needless to say, Russia's decision has dealt a huge blow to India. India increased imports from Russia due to Russia's willingness to accept payment in rupees. The Indian government itself buys crude oil from Russia, but Indian companies have also started buying coal and edible oil from Russia in large quantities.

Russian coal, edible oil, etc. were cheaper compared to other countries and the payment was expected to be made in rupees, so the Indian companies saw a two-sided advantage. Now that Russia does not accept payment in rupees, companies have to facilitate payment in dollars or other currencies. Paying in dollars or other currencies will be expensive as their value is very high against Indian rupees.

Russia has done like Garaj Sari i.e. Vaid Veri with India by giving a slip of selfishness. India needed to sell its goods to Russia due to the sanctions imposed by the US and its allies on Russia following Russia's invasion of Ukraine. Russia used to earn huge money by selling crude oil to European countries, but due to the ban of the European Union, the market of Russian crude has completely collapsed.

Russia needed to sell crude to keep its oil fields going. If the crude oil is not sold, the money will not come due to the loss, but also the people working in the oil fields will have to be laid off. Due to this, unemployment will increase and Russia's economy will collapse. To overcome this situation, Russia has shown readiness to provide crude oil on the condition that India and China are ready to buy crude oil.

It was also a beneficial deal for India, so India started buying crude from Russia by reducing its crude from other countries. Russia, using commercial intelligence, has provided commodities including crude oil for years and has also strengthened trade with China. Because of this, Russia no longer needs India much, so it has started showing aversion to accepting payments in rupees to hold India's nose. India's need for crude oil is very high and Russia gives crude oil to India at a cheap price, so Russia knows that India is not going anywhere.

Russia is taking advantage of India's thunder.

India has also postponed an arms deal with Russia fearing US sanctions. This deal is important for Russia as it needs money.

If India pays Russia in US dollars, countries including the US can impose restrictions on India for helping an aggressor Russia. India has postponed the arms deal as it would be expensive for India to pay in rubles. Russia is also counting on keeping its nose on this issue.

Shockingly for India, Russia is getting sick of taking payments in rupees but does not mind taking payments in Chinese Yuan. The reason is that Russia's trade with China has become huge. In one year, India took about 40 billion dollars worth of goods from Russia and gave 10 billion dollars worth of goods in return. Against this, Russia has taken goods worth 76 billion dollars from China and has given goods worth 115 billion dollars.

China gives very cheap goods to the whole world and also gives cheap goods to Russia. Due to this, Russia will buy more goods from China. For that he needs more Chinese Yuan. Countries including India should pay in Chinese Yuan, the balance should be given to China.

Russia is interested in the yuan so it doesn't have to use its own rubles to buy yuan.

After Russia's decision, India is left with two options. Either India has to show readiness to trade in dollar, Chinese yuan, UAE dirham or any other currency as Russia says or reduce trade with Russia and surrender to America and its allies.

As commodities, including crude, are available from Russia at cheap prices, reducing trade with it is a losing deal, leaving the option of payment in other currencies. Willingness to pay in Chinese yuan would mean accepting China's hegemony. Considering that China's economy will also strengthen due to the purchase of Chinese Yuan, India should consider the option of payment in currencies other than Chinese Yuan.

Russia's decision has also undermined efforts to establish the Indian rupee as a globally accepted currency. Even though India buys huge goods from Russia, if Russia is not ready to accept Indian rupees, where will other countries do the transactions in rupees?

Three and a quarter lakh crore rupees of Russia deposited in Indian banks

Russia, which has been keeping its economy booming for the last one year by trading with India, has started crying that it is in trouble due to the fact that it has got a lot of Indian rupees. Russian Foreign Minister Sergey Lavrov officially said that billions of Russian rupees have been deposited in Indian banks. The process of converting these rupees into other currencies has become a headache for us.

According to Lavrov, Russia is in dire need of money right now but billions of rupees lying in Indian banks are not being used. According to Lavrov, India and Russia are currently discussing ways to convert these billions of Indian rupees into other currencies.

Lavrov did not give the figure of how many Russian rupees are lying in Indian banks, but according to people involved in the banking system, about three and a half lakh crores of Russian rupees are in Indian banks. If this amount is converted into US dollars, it will be 41 billion dollars.

India is not responsible for the fact that the war with Ukraine is going on, so this huge amount will prove to be a boon for Russia, but Russia is not able to use this amount. Russia agreed to accept payment in rupees for its goods.

Payment to Russia through third countries including China

Companies importing from Russia and importers are adopting different ways to make payments to Russia. Payments in UAE dirhams have increased but most payments are made in US dollars. Due to sanctions on Russia, direct payment cannot be made, so payment is made through different channels. An arrangement is currently being worked out so that the payment is made to a third country via the SWIFT route and from there the payment reaches Russia. Money is also being paid to Russia through China.