According to the government, nine special vostro accounts have been formed with two Indian banks with RBI approval to promote commerce in Indian currency abroad. The largest and second-largest banks in Russia, Sberbank and VTB Bank, are the first foreign lenders to be given clearance after the RBI established the rules for rupee trade abroad in July.
Another bank in Russia The UCO Bank in Kolkata has also opened an account for Gazprom, which does not have a bank in India."There are now nine open accounts. One each with UCO Bank, Sber, VTB, and six IndusInd Bank. Six distinct Russian banks make up this group "Sunil Barthwal, the secretary of commerce, stated when publishing trade data.
The decision to open the special vostro accounts clears the way for rupee-based cross-border transactions, facilitating trade between India and Russia.
In order to spread awareness of the new structure, the RBI has permitted these special vostro accounts to invest the surplus balance in Indian government securities.
In response to the question of when the rupee trade with Russia may start, Barthwal said there is a process involved and that he hoped it would happen soon.
Further, Barthwal stated he held a meeting with officials of UCO Bank, RBI and the Department for Financial Services and discussed ways to promote rupee trade
