US Arm OFAC Frozen Fund Transfers Worth Nearly 26 Million Dollars By Indian Jewelers Due To This Reason

US action on Indian jewellers: The news of tension between Russia and America is not hidden from anyone and now the jewelers and diamond traders of India are also facing the brunt of this. In the last few months, the Office of Foreign Asset Control (OFAC), an organization of the US government, has frozen funds worth crores related to Indian jewelers working abroad. It has been alleged that they are importing and using rough diamonds mined in Russia. The worrying thing is that OFAC has frozen funds worth about $26 million so far.

These Indian firms are subsidiaries of UAE

The entities that have been directly affected are the United Arab Emirates (UAE) subsidiaries of the Indian diamond houses. Dollar payments by these UAE firms were stopped amid suspicion that their suppliers were of Russian origin. Apart from this, it has also been suspected that these Indian companies have investment and other economic relations with Russian mining and approved institutions.

According to an Economic Times report, dollar payments never reached sellers of rough diamonds whose suppliers maintained Nostro accounts with American banks. This happened after the instructions of the American authorities. A person associated with the diamond industry has given this information to ET.

what is nestro account

Nostro account is a foreign currency account that one bank maintains with another bank. These accounts are mainly used for carrying out foreign exchange transactions and cross-border trade settlement.

Efforts are on to resolve the issue

Vipulbhai Shah, chairman of the Gem and Jewelery Export Promotion Council (GJEPC), says that as an industry body, we have raised this issue with the Ministry of Commerce and the Indian Embassy in the UAE. This is because the import of Indian diamond companies was done through UAE subsidiary. This amount is about 26 million dollars and under this many types of payments are stuck which need to be resolved. He also said that we are trying to explain to OFAC that there are many payments that are before the sanctions on Russia and also with Russian subsidiaries before the first economic sanctions. The percentage of diamonds imported directly from Russia is very small.

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