U.S. Treasury Warns Indian Banks Over Russia Ties

U.S. Treasury Deputy Secretary Wally Adeyemo has warned Indian banks about potential sanctions if they conduct business with Russia's military industrial base. Adeyemo emphasized the risk of losing access to the U.S. financial system and stressed the importance of global efforts to end Russia's war against Ukraine.

In a stern warning delivered on Wednesday, U.S. Treasury Deputy Secretary Wally Adeyemo cautioned India's banking sector that financial institutions engaging with Russia's military industrial base could face severe repercussions, including losing access to the U.S. financial system. Reuters obtained a copy of this letter addressed to the Indian Banks' Association.

Adeyemo's warning comes amidst New Delhi's ongoing resistance to distancing itself from Moscow since Russia's 2022 invasion of Ukraine. This stance was notably reaffirmed after a recent meeting between Prime Minister Narendra Modi and Russian President Vladimir Putin. The letter follows an executive order by President Joe Biden designed to sanction foreign financial institutions dealing with Russia's military sector.

The missive also highlights the robust economic ties between the U.S. and India, noting a 110 percent increase in trade over the past decade. Despite this, the emphasis remains on the coalition's commitment to halting Russia's aggression by disrupting its financial and material supply chains. Adeyemo urged Indian banks to outline their compliance plans within 30 days.

(With inputs from agencies.)