India has asked the US to unfreeze $26 million that belongs to several Indian diamond companies but is frozen because they trade with the Russian diamond source “Alrosa,” which is under sanctions.
Sources at Reuters say that the US Treasury’s Office of Foreign Assets Control (OFAC), in charge of sanctions, froze the money earlier this year.
It is said that OFAC froze the money when unnamed Indian companies with offices in the UAE tried to send it to India to buy rough diamonds. It’s unclear if the money was being sent to “Alrosa” or someone else.
The government is aware of what OFAC has done and has started talking to them about it. The problem was that people thought they were dealing with Alrosa, said one source in the Indian government.
However, the Indian companies affected by the action told the government that the payments were for Russian organisations not subject to sanctions or for orders completed before the sanctions against “Alrosa” were enacted in April of the year before.
India has the most diamond processing capacity in the world. In the last fiscal year, which ended on March 31, it shipped polished diamonds worth more than $22 billion.