(MENAFN- AzerNews) The solution to the problem of incomplete convertibility of
currencies, in particular faced by Russia in its recently increased
foreign trade with India, may be the creation of a unit of account
on the BRICS platform, and Russia will promote this topic within
the framework of its presidency, Russian Finance Minister Anton
Siluanov said, Azernews reports, citing
Russia will chair BRICS in 2024, with the summit to be held in
Kazan in October. Currently, the association includes Brazil,
Russia, India, China and South Africa, but a number of other
countries have recently been invited to join BRICS.
"There is a problem [with settlements in foreign trade], indeed,
our main trade partners today are China, India, Turkey, the Persian
Gulf, in any case, all those friendly countries where trade flows
have been reoriented. And while the Chinese yuan is convertible,
and settlements in Chinese yuan are absolutely the same as in other
convertible currencies, there is a problem with Indian rupees. Our
Indian partners say - rather than having us pay you, invest this
money in our economy. And a lot of people are doing that. But we
say that let us return the proceeds for exported goods here, to
Russia. And they say to us [Russian exporting companies] - what
should we return, if they don't let us?" Siluanov said, answering
questions from the audience of his lecture for young people, held
There are interim solutions to this problem, but they are
"Even for rupees, which are not fully convertible, solutions can
be found. The simplest is settlement through third countries.
Indians are always happy to work through the Chinese yuan. Such
settlements happen through other currencies, including dirhams.
India too trades with partners other than Russia and has a surplus
or deficit in its trade balances. And somewhere rupees are
deposited, and these rupees will be needed by other countries to
buy goods from Indian partners, and somewhere vice versa - as in
our case, we do not need rupees, because we do not have large
imports from India, which would overlap with our export payments.
Therefore, this scheme works through third countries, through the
conversion of Indian rupees into other currencies and then into
rubles. Financial entities are engaged in this, banks are engaged
in this, etc. And it turns out as follows - if you have supplied
goods to our partners from India and want to get money, rubles or
other currency, you will have to accept a certain discount for it,"
the Finance Minister said.
Siluanov believes that a systemic way out of the situation
should be sought on an international platform.
"We will chair the BRICS next year, and one of the topics that
the Finance Ministry will state and work on with our colleagues is
the creation of settlements and a unit of account that would solve
issues of conversion, settlements, so that it would be possible,
given trade operations between BRICS countries, not to have these
problems," he said.
"By the way, one of the innovative proposals is to issue a
digital financial asset on the basis of a certain basket of
currencies of BRICS countries. A stablecoin backed by a basket of
currencies of BRICS countries. This would be cool - we will settle
within our system with the created unit of account backed by a
basket of currencies of the member countries. That would be great.
But it needs to be developed. There are a lot of details, a lot of
issues that will need to be discussed with our partners. This is
the topic that we are announcing in terms of the financial track
within the framework of our BRICS chairmanship," Siluanov said.
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