HomeWorldAsiaIran and Russia to Discuss Currency and Finance Agreements to Counter Sanctions

Iran and Russia to Discuss Currency and Finance Agreements to Counter Sanctions


Russian government and enterprises followed American sanctions against Iran and refrained from selling weapons to Tehran until recently. However, Russia is now willing to discuss expanding its financial cooperation with Iran. There was some speculation in the past of a Russian-Iranian quasi-currency that would be backed by gold. On Tuesday, Elvira Nabiullina, the head of the Russian Central Bank, embarked on a trip to Tehran. It was stated that Mohsen Karimi, the Iranian Central Bank deputy director, would visit her. He stated that negotiations for currency and finance agreements would occur during the visit.

The trip to Iran that Nabiullina took was prearranged. Following Alexander Novak’s trip to the Islamic Republic the previous week, it was widely speculated that the head of the Russian Central Bank would accompany him on his trip to Tehran.

According to sources in Russia, Nabiullina and the heads of central banks from a variety of countries, including Bangladesh, Myanmar, Bhutan, Pakistan, Afghanistan, and others, will be attending a conference in Tehran that will take place over two days and be hosted by the Asian Clearing Union.

Recently, Ali Asghar Shalbafyan, Iran’s Deputy Minister of Tourism, Cultural Heritage, and Handicrafts, declared that Russia and Iran had completed all preliminary agreements for using “Mir” cards. These agreements cover the reciprocal recognition of each country’s passports. This was discussed at a meeting named “Russia-Islamic World: KazanForum,” where it was announced. During the same session, Russian government representatives and businesses discussed the agreement’s terms for developing the “North-South” transport route with Iran and constructing a joint commerce fleet. The countries are working hard to advance collaboration. As part of this process, they are moving away from using the dollar in their bilateral settlements and integrating their banking payment systems. The Russian financial institution VTB has only recently opened its first branch in Iran. Iran is now one of the countries that Russia, China, India, and the nations of Central Asia have expanded their ties with. This allows Iran to lessen the sanctions’ impact on its economy.

Following their meeting the previous week, Novak indicated that Russia and Iran settle around 80% of their transactions in their respective national currencies. This information was provided by Novak following their meeting. He went on to say that they were also considering the possibility of including the currencies of other countries, such as the yuan, as one of the potential settlement units in the future.

In 2022, the value of the goods and services exchanged between Russia and Iran reached $4.6 billion, representing a 15% rise over the previous year. According to Vyacheslav Volodin, who serves as the speaker of the State Duma, the partnership between the two countries extends to nearly every area of activity. Relatively recently, the G7 issued a strong demand to Tehran that it desist from supporting Moscow in the context of the situation in Ukraine and from providing arms to Russia. Western reports claim that there is a possibility that Russia got ammunition and other military equipment from Iran.

Both countries have experienced an uptick in the number of tourists travelling to their respective cities over the past few years. According to the frontier service of the Federal Security Service (FSB), the number of Russians entering Iran almost quadrupled in the first quarter of 2023 compared to the pre-crisis year of 2019, and it nearly tripled in the same period of the previous year. This is compared to the number of Russians entering Iran in the same period as the previous year. 10,4 thousand people from Russia visited the Islamic Republic between January and March 2023. 

Frontier India News Network
Frontier India News Networkhttps://frontierindia.com/briefs
Frontier India News Network is the in-house news collection and distribution agency.


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