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Russia to work with BRICS on accounting unit to solve conversion issues — Finance Minister

As Anton Siluanov noted, one of the innovative proposals is the issuance of a digital financial asset based on a certain basket of currencies of the BRICS countries

MOSCOW, December 8. /TASS/. Russia, as the chairman of BRICS, will promote and work with the member countries of the association to create an accounting unit to solve the problem of currency convertibility, Russian Finance Minister Anton Siluanov at a lecture at the Russia exhibition and forum.

"We [Russia] will preside over BRICS next year. <...> And one of the topics that the Finance Ministry will announce and work on with our colleagues is the creation of settlements and an accounting unit that would allow us to resolve issues of conversion," Siluanov said, answering the question about the convertibility of rupees.

As he noted, one of the innovative proposals is the issuance of a digital financial asset based on a certain basket of currencies of the BRICS countries.

"[There can be] a stablecoin backed by a basket of currencies of the BRICS countries. Then it would be cool - we will be settled within our system with a created unit of account backed by a basket of currencies of the participating countries. <...> But this needs to be worked out, there are a lot of details," Siluanov said.

For the moment, there is a real problem with settlements, the minister noted.

"If the Chinese yuan is convertible, and payments in Chinese yuan are absolutely the same as in other convertible currencies, there is a problem with Indian rupees," Siluanov said.

However, as the minister noted, solutions can be found for rupees, which are not fully convertible.

"Indians always want to work through Chinese yuan. Through other currencies, including dirhams. <…> India also trades with other partners besides Russia and has a surplus or deficit in its trade balances. Somewhere rupees are accumulated, and those countries will need these rupees to buy goods from Indian partners, but somewhere on the contrary - like here [in Russia], we don’t really need rupees, because we don’t have large import supplies from India that would cover our exports payments," the minister explained.

BRICS unites Brazil, Russia, India, China and South Africa. At the summit on August 22-24, Argentina, Egypt, Iran, the United Arab Emirates, Saudi Arabia and Ethiopia received an invitation to join BRICS on January 1, 2024.

About situation with "stuck" rupees

Earlier, former Finance Minister of Russia Mikhail Zadornov named the so-called "stuck" rupees in India as one of the reasons for the weakening of the ruble exchange rate. According to the expert, domestic companies receive payment for exports in Indian currency, refusing to pay in dollars. At the same time, large volumes of exports led to the fact that the rupees got stuck since Russia actually has nothing to buy from India, he noted.

The Russian Energy Ministry then denied Zadornov’s words. They told TASS that this opinion does not reflect the real state of affairs, since oil companies return most of the foreign exchange earnings, and the delays are not systemic.