Russian lender, which probably escaped the scanner of the West because of its negligible presence Europethe prosperous neighborhood and others developed economieshas opened one rupee accounts with about three dozen Russian companies, which settle payments for business with New Delhi.
Separately, the Reserve Bank of India ,reserve Bank of India) is likely to issue an FAQ on standard operating procedures relating to rupee accounts, said people familiar with the matter.
PSCB Founder and Chairman Vladimir L Pribitkin, in response to ET’s query, said, “We have opened a Rupee-Ruble account with Yes Bank. “We are currently transacting through it as we make payments in Rupee-Rubles on behalf of about three dozen of our Russian customers engaged in trade with India.”
Some of the clients of PSCB include LLC Mettem-M, LLC Armtel and LLC NKP Farmindusery. The Bank deals mostly with companies engaged in bilateral Indian trade relating to pharmaceutical ingredients, fruits and spices. RBI and Yes Bank did not comment on the matter. Individual companies could not be immediately reached for comments.
The Russian bank is probably the first bank to open a rupee account with an Indian lender after the Russia-Ukraine military conflict in the last few months. The rupee account is likely to be converted into a special rupee account at a later stage after clarifications from the FAQs by the central bank.
‘special’ tag
Yes Bank is said to have received three-four more applications from other Russian lenders such as MFK Bank,
Sources said Indian lenders have received around two dozen such applications, most of which are now lying with the central bank for approval.
Indian Banks Association (Different) is facilitating the entire process with Russia-India trade becoming the focal point for such bespoke accounts.
A senior official involved in diplomatic communication between the two countries said, “Most of the Indian lenders have forwarded all applications to the RBI, which are yet to decide on the approval.”
A ‘Special’ tag for Rupee Vostro account allows utilization of surplus balances in Government of India securities.
More than a week ago, Indian lenders held meetings with the government and the RBI in an effort to fix operational bottlenecks. The Russian delegation also met Indian parliamentarians and regulators.
Transmission of messages, opening of letters of credit, common reference rate between rupee and ruble, legal framework, and repatriation of rupee among other procedural matters came up for discussion.