“Russian banks will have to open Vostro accounts in India, and whenever exports or imports take place, that account will be debited or credited, depending on the transaction,' said a senior private sector banker, adding that this will only be possible for Russian banks that are not part of the OFAC sanctions list.Įnforced by the US Office of Foreign Assets Control (OFAC), the sanctions were implemented after Russia’s invasion of neighbouring Ukraine in February. Now, if RBI approves, the final settlement to all countries can be in the Indian rupee, Sakthivel said. Sakthivel, president of the Federation of Indian Export Organisations (FIEO), under the existing provisions of the Foreign Exchange Management Act, final settlements must be in free foreign exchange except for Nepal and Bhutan.

Hailing the move, experts said it would expedite transactions between the two countries.įollowing the sanctions, payments to any Russian entity, including those that haven’t been sanctioned, have been taking longer than usual because of enhanced due diligence.Īccording to A.

All country rupees