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The Workplace of Overseas Belongings Management (OFAC), the U.S. Treasury unit that oversees sanctions, froze the funds earlier this yr, mentioned two of the sources. Each are Indian authorities officers however declined to determine themselves or the businesses citing the sensitivity of the matter.
The OFAC freeze is the primary identified punitive measure in opposition to any Indian enterprise since Russia‘s full-scale invasion of Ukraine final yr and subsequent Western sanctions on Russian entities.
OFAC froze the funds when UAE-based items of the unspecified Indian firms tried to switch them to purchase tough diamonds. Reuters couldn’t decide if the cash was being transferred to Alrosa or one other occasion.
“The federal government is conscious of the OFAC motion and has initiated dialogue over it,” one of many Indian authorities sources mentioned. “The issue was suspicion of commerce hyperlinks with Alrosa.”
The Indian corporations impacted by the motion have informed the federal government that the funds have been meant both for non-sanctioned Russian entities or for orders accomplished earlier than the sanctions on Alrosa got here into impact in April final yr, the supply mentioned. State-controlled Alrosa, the world’s largest producer of tough diamonds, didn’t reply to an electronic mail searching for remark. India’s commerce and overseas ministries and the U.S. treasury division additionally didn’t reply to requests. India has the world’s largest diamond processing capability and exported polished diamonds value greater than $22 billion final fiscal yr that ended on March 31. The trade, primarily based primarily within the western state of Gujarat, buys tough diamonds from suppliers in nations such because the United Arab Emirates, Belgium and Russia.
