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According to the Economic Times, US officials have stopped transfers worth approximately $26 million by entities affiliated with Indian diamond dealers in connection with alleged Russian imports.
The US Treasury Department’s Office of Foreign Assets Control (OFAC) reportedly targeted subsidiaries of Indian diamond firms based in the UAE.
Dollar payments by UAE-based companies were halted due to allegations that their supplies were sourced from Russia, or that they had investments and other ties with Russian miners and sanctioned groups.
According to chairman Vipul Shah, the Gem and Jewellery Export Promotion Council (GJEPC) has raised the issue with the Ministry of Commerce and the Indian Embassy in the UAE.
“We’re also attempting to explain to OFAC that the payments were made to non-sanctioned entities, including some Russian entities, long before the sanctions were imposed.” “There is very little direct diamond import from Russia,” Shah explained.
In an effort to significantly reduce Moscow’s earnings, G7 leaders committed in May to prohibit trading in diamonds mined, processed, or created in Russia.
The group of Western industrialized nations announced in a joint statement that it would use tactics such as high-tech tracing to reduce the $4.5 billion Russian diamond traffic.
Kirit Bhansali, founder of Smital Gems and vice-chairman of the GJEPC, told the Economic Times that the Indian government intends to address the issue with the G7 nations in order to assure rough diamond supplies while protecting the interests of the US government.
“Some of our Dubai-based importers who made remittances through banks there have not received payments for almost six months,” the spokesman explained.