Russia's Sberbank says India business booming despite Western sanctions
By Elena Fabrichnaya and Gleb Bryanski
MOSCOW, Sept 3 (Reuters) -Russia's trade with India is booming and bilateral payments are proceeding smoothly without the glitches that have been hampering trade with other countries, Anatoly Popov, deputy CEO of Russia's largest lender, Sberbank, told Reuters.
Sberbank handles payments for up to 70% of all Russian exports to India. Russia's trade with India nearly doubled to $65 billion in 2023, with the country becoming a major importer of Russian oil after Western sanctions imposed in 2022 over a conflict in Ukraine.
"In 2022, there was a significant increase in the interest of Russian businesses in the Indian market because this market serves as an alternative," Popov told Reuters in an interview ahead of the Eastern Economic Forum, an economic conference targeting Russia's Asian partners.
Sberbank's branch in India has offices in Delhi and Mumbai, as well as an IT centre in Bangalore. The number of staff in its Indian offices increased by 150% this year, having said in April they wanted to hire 300 IT personnel for the hub in Bangalore.
Sberbank is under Western sanctions and therefore cannot make transactions in U.S. dollars and euros or use the SWIFT system for international transfers. However, Popov said the bank has not experienced any problems in India.
"Sberbank is a full participant in all Indian payment and interbank systems. There are no restrictions on its operations," Popov said. India has not joined any anti-Russian sanctions and maintains friendly relations with Russia, a fellow member of the BRICS group of emerging economies.
Sberbank said transactions in roubles and rupees are proceeding smoothly, with 90% of them taking only a few hours to complete. This is in stark contrast to other trading partners such as China.
Popov stressed that growing Indian exports to Russia have helped solve the problem of the rupee surplus held by Russian companies, which hampered bilateral trade in 2023, as rupees were used to pay for imports from India.
"The problem has been solved, there is no rupee surplus any longer," Popov said, emphasising that to achieve balanced trade, India still needs to increase its exports to Russia 10-fold. An Indian source told Reuters on Aug. 14 that the rupees surplus has dropped to a "few million dollars".
He said that India, the world's fifth largest economy, had almost everything Russian importers were looking for.
"India is a self-sufficient, vast economy capable of meeting its own needs. Therefore, any goods that Russia previously imported can be purchased in India," Popov said.
Sberbank is also developing its offering of hedging instruments, which already includes forwards and options, as well as other products such as rupee-denominated loans for Russian companies at rates significantly lower than in Russia.
He thanked Indian regulators for the opportunity to operate through rupee-denominated "vostro" accounts, which domestic banks can hold on behalf of foreign banks in India, facilitating their operations.
Popov said that the current mechanism of converting roubles and rupees was functioning well and did not require any third-party currencies for settlement. However, he emphasized that stock exchange trade in rupees would increase transparency.
Reporting by Elena Fabrichnaya and Gleb Bryanski; editing by Guy Faulconbridge and David Evans
Dernières actualités
Avertissement : Les entités de XM Group proposent à notre plateforme de trading en ligne un service d'exécution uniquement, autorisant une personne à consulter et/ou à utiliser le contenu disponible sur ou via le site internet, qui n'a pas pour but de modifier ou d'élargir cette situation. De tels accès et utilisation sont toujours soumis aux : (i) Conditions générales ; (ii) Avertissements sur les risques et (iii) Avertissement complet. Un tel contenu n'est par conséquent fourni que pour information générale. En particulier, sachez que les contenus de notre plateforme de trading en ligne ne sont ni une sollicitation ni une offre de participation à toute transaction sur les marchés financiers. Le trading sur les marchés financiers implique un niveau significatif de risques pour votre capital.
Tout le matériel publié dans notre Centre de trading en ligne est destiné à des fins de formation / d'information uniquement et ne contient pas – et ne doit pas être considéré comme contenant – des conseils et recommandations en matière de finance, de fiscalité des investissements ou de trading, ou un enregistrement de nos prix de trading ou une offre, une sollicitation, une transaction à propos de tout instrument financier ou bien des promotions financières non sollicitées à votre égard.
Tout contenu tiers, de même que le contenu préparé par XM, tels que les opinions, actualités, études, analyses, prix, autres informations ou liens vers des sites tiers contenus sur ce site internet sont fournis "tels quels", comme commentaires généraux sur le marché et ne constituent pas des conseils en investissement. Dans la mesure où tout contenu est considéré comme de la recherche en investissement, vous devez noter et accepter que le contenu n'a pas été conçu ni préparé conformément aux exigences légales visant à promouvoir l'indépendance de la recherche en investissement et, en tant que tel, il serait considéré comme une communication marketing selon les lois et réglementations applicables. Veuillez vous assurer que vous avez lu et compris notre Avis sur la recherche en investissement non indépendante et notre avertissement sur les risques concernant les informations susdites, qui peuvent consultés ici.