In the wake of the Russian invasion of Ukraine, the European Union has prohibited global transactions with Russian entities using euro-denominated banknotes, while the U.S. has cut off Russia’s access to the U.S. Dollar. This has made India, which continues to trade with Russia, consider reviving the Rupee-Rouble mechanism, previously used in 1953.
What is the Rupee-Rouble mechanism?
The Rupee-Rouble trade arrangement is an alternative payment mechanism to settle dues in rupees instead of Dollars or Euros. The idea was first conceived in 1953 under the Indo-Soviet trade agreement.
