De-Dollarization and ‘Yuanization’ of Russian Trade
November 29, 2022
Russia used to trade in US Dollars or Euros till February 24, 2022. After the Ukraine war started, the west imposed sanctions on Russia, creating issues in continuing the transactions in US Dollars or Euros.
Since the start of the Ukraine war, Russia has been trying to trade with China in Yuan and with India in Indian Rupees.
The Report by Elena Fabrichnaya and Samuel Shen in Reuters (Reference: https://tinyurl.com/yc5esc3j ) shows that China has succeeded in having a good amount of trade in Yuans. The total transactions on the Moscow Exchange have increased to $1.25 billion a day.
On the other hand, India’s trade with Russia in Rupees continues to be very small. Since Russia is offering crude oil to India at cheaper rates and since due to the Ukraine war, OPEC oil has become very costly, to control inflation in India and for not pushing India’s poor to penury, India has been using the cheaper
oil offer from Russia till OPEC decides not to exploit India’s poor by using the pretext of Ukraine war.
India has to pay Russia for the oil. If Russia has asked for some civilian goods, India should try to sell them to Russia so that this opportunity is not taken away from its hands by the Chinese traders, who are connected with Russia through good rail-road connections.
Why are India’s exports to Russia so small? Is it due to weakness of Indian traders and business-houses or is it due to inefficiencies in Indian Governmental system?
Note: Please also read “West’s Sanctions on Russia” at https://diginews360.com/wests-sanctions-on-russia/