![]() ![]() The agreement bypasses, but does not technically violate, US and EU sanctions. In July, the Reserve Bank of India announced that Indian companies can now settle in rupees payments made in Russian rubles. Now India's revival of a rupee-ruble settlement system will ease transactions for imports and exports. Trade financing and payments, however, were crippled by removal of Russian banks from international payments systems. International sanctions on Russia exempt food, including tea. Russia imported 32.5 million kilos of Indian tea in 2021. Because of this stoppage, Russia's imports of Indian tea during the first quarter of 2022 fell to 6.8 million kilos, compared to 8.3 million kilos in 2021. Trade with Russia virtually halted in March following its invasion of Ukraine. Prices since April escalated by around 50% for orthodox tea and are up 40% for CTC (cut, tear, curl) grades. Prices at auction were low in April 2022, dragged down by pressure to factor in much higher transport costs, averaging INR144 per kilo compared to INR187 per kilo in April the year before. Tea shipments to the Russian Federation in April rose to 3 million kilos, up 22% from the 2.54 million kilos in April 2021. ![]() India's exports of tea to Russia are booming, as Russian importers scramble to fill the gap in supplies created both by Sri Lanka's crisis and by repercussions of its war in Ukraine. Russia now imports more tea directly from India, in part because product destined for Russia is no longer offloaded at the port of Odessa, Ukraine. ![]()
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