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US Warns India Against Rupee-Rouble Mechanism; No Prohibition On Energy Imports

Earlier in the week, officials of the Bank of Russia met Reserve Bank of India officials to discuss alternative payment mechanisms and routing through banks that are immune to international sanctions

Photo Credit : Ministry of External Affairs


Foreign Secretary Harsh Shringla with US Deputy NSA Daleep Singh at a meeting in New Delhi on March 31, 2022.

American Deputy National Security Advisor for International Economics Daleep Singh on Thursday said that there will be "consequences" for any country, including India, conducting local currency transactions through Russia's central bank or devising any payment mechanism to bypass American sanctions against Russia.

Singh is among President Biden's top advisor and key person leading the economic war through sanctions against Russia. The White House earlier informed that Singh will be in New Delhi on March 30 and 31 where he would consult closely with counterparts on the consequences of Russia's "unjustified war" against Ukraine and mitigating its impact on the global economy.

"We would not like to see mechanisms that are designed to prop up the rouble or to undermine the dollar-based financial system, or to circumvent our financial sanctions," he said. 

Highlighting the growing Russia-China axis, Singh also publicly stated that India must not expect that Russia, as a “junior partner” of China, would assist India if there were more incursions along the Line of Actual Control.

“I come here in a spirit of friendship to explain the mechanisms of our sanctions, the importance of joining us, to express a shared resolve and to advance shared interests. And yes, there are consequences to countries that actively attempt to circumvent or backfill the sanctions,” Singh told journalists between his official meetings.

No Prohibition On Energy Imports

On energy imports, however, Singh said that there is no red line. "The United States is ready to help India diversify its energy and defence supplies," Singh said.

"We stand ready to help India diversify its energy resources, much like is the case for defence resources over a period of time. But there is no prohibition at present on energy imports from Russia," he said.

"What we would not like to see is a rapid acceleration of India's imports from Russia as it relates to energy or any other exports that are currently being prohibited by us or by other aspects of the international sanctions regime."

Over two days in Delhi, Singh met his counterpart Deputy NSA Vikram Misri, Commerce and Industries Minister Piyush Goyal, Foreign Secretary Harsh Shringla and officials in the Prime Minister’s Office and the Finance Ministry.  

(With inputs from agencies)