India has decided to authorise the State Bank of India to promote rupee trade with Russia and soon Moscow will name its bank to operationalise the mechanism, exporters’ body FIEO said on Wednesday.

The RBI in July issued a detailed circular asking banks to put in place additional arrangements for export and import transactions in rupees in view of increasing interest of the global trading community in the domestic currency.

Currently, a large part of bilateral trade between India and Russia is getting settled in rupee due to sanctions imposed by the US and Europe following Moscow’s attack on Ukraine.

The RBI had said for settlement of trade transactions, the concerned banks will require special rupee vostro accounts of correspondent bank/s of the partner trading country.

Federation of Indian Export Organisations (FIEO) president A. Sakthivel said that the SBI is equipped with doing business in the rupee with Russia, but Moscow has to identify one bank.

“Yesterday commerce secretary (B.V. R. Subrahmanyam) was there with us in the evening. He said that very soon the Russian government is going to identify a bank... Rupee trade with Russia will happen,” Sakthivel said.

He said that Russia is expected to announce the name of the bank in 15 days.

“So the SBI is already identified here...We have a good rupee payment mechanism in Iran, so same thing will happen (with Russia)...SBI is a huge bank to cater the need of exporters,” he added.