OFAC freezes payments by Indian jewelers for $26 million worth of Russian diamonds

The US Office of Foreign Assets Control (OFAC) froze payments by several Indian companies worth about $26 million. According to OFAC, they imported Russian rough diamonds. An Indian newspaper reported The Economic Times with reference to sources.

The payments of Indian jewelers to the UAE were frozen. OFAC has suspected that their suppliers have Russian roots or are associated with Russian mining or sanctioned companies. The rough sellers did not receive these payments due to the direction the banks received from OFAC.

“We are trying to explain to the OFAC that the payments were made to non-sanctioned entities and some Russian entities long before the sanctions took effect,” Vipul Shah, head of India’s industry regulator, told The Economic Times. According to him, direct import of diamonds from Russia to India is very insignificant.

Deputy regulator Kirita Bansali said that according to his information, some Indian importers based in Dubai have not received payments for diamonds in the past six months.

According to the Kimberley Process, in 2022, rough diamond exports from Russia decreased by 24%, to 6.7 million carats, against the background of a 7% increase in production, to 41.9 million carats. At the same time, the value of exports amounted to $3.8 billion, which is only 4% less than in 2021.

More details – in the material “Kommersant” “Diamonds returned from abroad”.

Olesya Pavlenko