Iran launches trading in Rial-Ruble ahead of Russian President Vladimir Putin's visit

The governor of Iran's Central Bank announced on Tuesday that the country's exchange launched trading in Iranian Rial-Russian ruble. According to reports, this development comes ahead of Russian President Vladimir Putin's visit to Iran to discuss an UN-backed proposal to unblock exports of Ukrainian grain. "The launching of trading in the ruble/ Iranian rial currency pair is an important step in the development of economic relations between Iran and Russia," Central Bank Governor Ali Saleh Abadi stated, Sputnik news agency reported. 

The Central Bank governor's statement comes as Moscow and Tehran have agreed to increase their collaboration, notably with regard to banking and financial systems. Earlier, Dmitry Peskov, a spokesperson for the Kremlin, stressed that Russia would gradually stop using the US dollar while trading with Iran. According to reports, Moscow and Tehran appear to be getting along better now as the two countries are the target of severe Western sanctions aimed at their financial systems. Meanwhile, Iran's Bank Melli and Russia's Sberbank signed cooperation agreements on July 17, and they intend to further develop economic connections between the two countries.

Russia, Iran explore unification of their banking systems

In addition, a new trade centre was also established under the aegis of Mir Business Bank, a Russian bank owned solely by Bank Melli. The unification of their banking systems has also been explored by the two countries, especially in an attempt to find an alternative to SWIFT.

Notably, SWIFT is used by different financial institutions to send and receive information, such as instructions for cross-border money transfers. Additionally, the adoption of MIR - a Russian payment system - credit cards in Iran is also being discussed by Moscow and Tehran, as per Sputnik. 

Iran condemns Western sanctions imposed on Russia 

It is significant to mention here that Iranian President Ebrahim Raisi was one of the first global leaders who reached out to President Putin after the Ukraine war broke out on February 24 and echoed Moscow’s clarification of "the North Atlantic Treaty Organization's (NATO’s) expansion being a threat to the security and stability of independent countries in various regions." Besides, Tehran has also vociferously denounced the "unilateral sanctions" being imposed by the Western nations on Russia. Meanwhile, the Russian government has extended its gratitude to the middle eastern country for adopting an "objective stance" on Moscow's military intervention in Ukraine. 

(Image: AP)