'Deeply Disappointing' if India Joins Russia’s Financial Transfer System, Says US Commerce Secy

The Indian government is currently reportedly considering a proposal to use Russia’s central messaging system SPFS to allow for financial transactions for oil and military equipment.

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New Delhi: The United States has termed reports of India working out a payment system with Russia to purchase highly discounted Russian crude in order to dodge sanctions as “deeply disappointing” and again urged New Delhi to stand “on the right side of history”.

The remarks were made by US commerce secretary Gina Raimondo on Wednesday at a public interaction with visiting Australian trade minister Dan Tehan in Washington.

The Indian capital is already witnessing a sudden rush of visitors, with Russian foreign minister Sergei Lavrov set to arrive in Delhi on Thursday night. Meanwhile, US deputy national security advisor for international economics, Dalip Singh, who is the chief architect of the series of sanctions against Russia, is currently in India to talk with his counterparts to discuss India’s continuing trade with Moscow.

The UK foreign secretary, Liz Truss, is also visiting New Delhi as part of a diplomatic outreach over Ukraine.

India has abstained on resolutions against Russia at various bodies in the United Nations against the invasion of Ukraine. At the same time, New Delhi has asserted that it supports the principle of the UN charter and territorial integrity of sovereign nations.

While US and its western allies have imposed far-reached economic sanctions against Russia, India has not deviated from its long-standing position of not endorsing unilateral sanctions which do not have the cover of the United Nations.

According to Bloomberg, the Indian government is currently considering a proposal to use Russia’s central messaging system SPFS to allow for financial transactions for oil and military equipment. As part of sweeping sanctions, Russian banks have been barred from SWIFT, the cross-border payment system operator.

In answer to a question from The Sydney Morning Herald on the proposed Russia-India banking cooperation and the implications for the Quad, US secretary of commerce Gina Raimondo said that such a plan would be “deeply disappointing”, if implemented.

“Now is the time to stand on the right side of history, and to stand with the United States and dozens of other countries standing up for freedom, democracy and sovereignty with the Ukrainian people, and not funding and fuelling and aiding President Putin’s war,” she said. Raimondo admitted that she had not yet seen the details of the plan.

The US has also previously stated that purchase of Russian oil would put India on the “wrong side of history”. Indian officials had pointed out that there were no sanctions on Russian oil exports and European allies of the US were still buying fuel from Russia.

The Australian trade minister added that the “Quad is incredibly important for the geostrategic environment in the Indo-Pacific”. “One of the things we have to do as democracies is making sure we’re working together to keep the rules-based approach that we’ve had since the Second World War. We’ll continue working with India, both within the Quad and on a bilateral nature, to make sure we’re doing everything that we can to ensure that rules-based approach continues,” he said.

Ukraine had been discussed at length during the Quad leaders’ summit this month. However, India had repeatedly asserted that the Quad should not remove its focus from the Indo-Pacific. The other Quad members, US, Japan and Australia, have been on the same page on taking punitive economic steps against Russia and asserted that crisis in Europe also has implications for the Indo-Pacific region.