In what can be seen as the first major financial step against Russia by India, the country's largest public sector bank SBI has reportedly stopped processing transactions involving Russian entities against which international sanctions have been announced amidst the Ukraine-Russia war.
As per a Reuters report, SBI has sent a letter to certain clients asking them to take ¡°extra precautions¡± while handling any transactions related to sanctioned nations.
The Reuters report added ¡°No transactions involving entities, banks, ports or vessels appearing¡± on a US, European Union or United Nations sanctions list shall be processed irrespective of the currency of the transaction.
Also, a senior SBI executive reportedly told the agency that the lender (SBI) had a significant international presence and it needs to comply with the US and EU regulations as it is present in those jurisdictions and that the bank cannot be seen as not adhering to these rules.
On the other hand, while there was no official comment from SBI, it is understood that the curb will only apply to fresh transactions and that it will not have any impact on past deals.
It remains to be seen if such a step by the biggest PSU?bank?will have any impact on the bilateral trade between India and Russia, which has stood at $9.4 billion so far this fiscal.? Other lenders are also likely to follow suit, as per a report in?The Telegraph.
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Banks like SBI are reportedly waiting for more details from the US and other nations on the nature of sanctions against the Russian entities. And that¡¯s not all. The domestic lenders are also reportedly waiting for instructions from the Centre regarding how to proceed with transactions pertaining to Russian banks.
In the past few days, numerous countries have announced financial sanctions against Russia, to demonstrate their stance against the country¡¯s invasion of Ukraine. Earlier, the UK PM had announced their largest sanctions against Russia, besides Russia also being shut out of the international payment system SWIFT.
Also Read:?How Russia-Ukraine War Is Pushing Debt-Ridden Sri Lanka Towards A Possible Default
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