Funds worth ₹215 crore frozen: US targets Indian diamond sellers over alleged Russia connection: Report
OFAC has frozen $26m in fund transfers from Indian jewellers allegedly involved in importing rough diamonds from Russia.
The Office of Foreign Assets Control (OFAC) has taken action against multiple offshore firms owned by Indian jewellers. Over the past few months, approximately $26 million ( ₹215 crore) worth of fund transfers have been frozen by OFAC, targeting entities allegedly involved in the import of rough diamonds sourced from Russia, The Economic Times reported.
The impact of this move has been felt by the United Arab Emirates (UAE) subsidiaries of Indian diamond houses, whose dollar payments have been stalled due to suspicions of connections with Russian miners and sanctioned entities.
As a result, the intended payments for rough diamond sellers have not been fulfilled, as instructed by US authorities to the banks handling the nostro accounts of the suppliers, the publication reported. LiveMint could not independently verify the development.
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The diamond trade community, renowned for its close-knit network, is now using its influence to address the situation and mitigate the damage caused by this freezing of funds.
Vipulbhai Shah, the chairman of the Gem & Jewellery Export Promotion Council (GJEPC), has taken up the matter with the Ministry of Commerce and the Indian embassy in the UAE.
"We, as the industry body, have taken up the matter with the ministry of commerce and the In- dian embassy in the UAE because the payments for imports were made by UAE subsidiaries of Indian diamond companies. Around $26 million, involving about a dozen payments, are stuck," ET quoted Shah as saying.
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India to find common ground
The action taken by OFAC, a division of the US government, may be connected to the stance expressed by the G7 leaders in their statement on February 24, which addressed Russia's significant revenues from diamond exports, the publication added.
Kirit Bhansali, founder of Smital Gems and vice-chairman of GJEPC, disclosed that there wojld be upcoming discussions with G7 nations. The Indian government aims to find common ground to ensure the continued supply of rough diamonds while respecting the interests of the US government.
"Some of our Dubai-based importers who made remittance through banks there have not received payments for al- most six months. The UAE government and the Dubai Multi Commodities Centre have taken up the matter with OFAC," ET quoted Bhansali as saying.
Read more on the development in the ET report.
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Business NewsNewsIndiaFunds worth ₹215 crore frozen: US targets Indian diamond sellers over alleged Russia connection: Report
First Published:7 Aug 2023, 08:01 AM IST
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