Moscow/Beijing: – Russia has turned its attention to China to counter the stringent sanctions imposed by the western countries. The Russian banks, worst hit by the western sanctions, have started using Chinese currency, Yuan. VTB, the leading Russian bank, has appealed to its customers to convert their deposits to Yuan and has even assured an interest rate of 8%. While Russia is increasing the use of the Yuan, Russian Foreign Minister Anton Siluanov claimed that the United States and its allies have also started pressurising China.
More than two weeks have passed since the Russia-Ukraine conflict and the United States and allies are consistently showering harsh sanctions on Russia. Russian Sectors from fuel, considered to be the backbone of the Russian economy and finance, banking, defence, investment, space and technology, have been targeted with sanctions. These sanctions are being used as weapons to force Russia to retreat. The effects are becoming apparent in the Russian economy.
Russian government spokesman Dmitry Peskov has even confessed, ‘The western countries have declared an economic war against Russia. Given these economic wars, the Russian economy has been severely rocked, and it is difficult to predict its future.’ To retaliate in this economic war, Russia has turned its focus to its ally, China.
Russia has consistently increased its cooperation with China over 10 to 15 years. Both the countries have signed big agreements in the trade, currency and investment sectors, and fuel sectors. In view of the agreements, the Chinese currency Yuan is readily available to Russia and the Russian banks have started transacting in Yuan on a large scale. Yuan has a 12% share in the Russian foreign reserves. It is said that $140 billion out of the Russian foreign reserves of $640 billion foreign are in China. It is believed that Russia will use these against the background of the western sanctions. Realising this, the United States and its allies have started threatening China. Russian Finance Minister Anton Siluanov gave this information.
Russian Foreign Minister accused, ‘Russian Gold and a portion of the foreign reserves are in Yuan. The western countries are pressurising China to ensure that Russia cannot use these reserves. China has been advised to reduce transactions with Russia. Pressure is being exerted to stop the foreign reserves.’ Siluanov said that the Russia-China cooperation and partnership are strong and expressed confidence that the threats of the westerners will not have much effect.
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