How payments between India and Russia actually work

Why this is the first question, not a detail

In most trade corridors payment is a mechanical step handled by the banks once commercial terms are agreed. In this corridor it is a structural question that determines whether the trade is viable at all, and it varies by bank, by counterparty and by product.

Treating it as a detail to sort out later is the single most expensive mistake in this trade. Goods that have shipped against an unworkable payment route are goods you may not be paid for.

Settle it with the bank, in writing, before you contract

Not with a broker’s assurance, not with a counterparty’s confidence, and not on the basis of what worked for someone else last year. Confirm with the bank that will actually handle your transaction, for your counterparty, and get it in writing.

Banks differ substantially in their appetite here, and a route that one institution declines another may handle routinely. If your bank says no, that is information about your bank, not necessarily about the trade.

Screening comes first

No payment structure survives a counterparty who should not have been engaged. Screening against the applicable restricted-party lists is a legal obligation and must be completed before any commitment, not as a formality afterwards. A payment route that works for one counterparty tells you nothing about another.

Structure the first trade differently

First trades between parties who do not know each other carry risk on both sides simultaneously: the buyer fears paying for goods that never arrive or arrive wrong, the seller fears shipping goods that are never paid for.

Escrow arrangements, staged payments tied to verified milestones, and independent pre-shipment inspection all address this. Inspection in particular does double duty — it protects the buyer commercially and it gives the seller a documented basis for demanding release of payment.

Write the mechanism into the contract

The contract should specify the payment mechanism, the currency, the timing relative to shipment and inspection milestones, and what happens if the route becomes unavailable mid-transaction. That last clause is unusual in most trade contracts and worth having in this one.

What we do

Payment routing is one of the first things we resolve on any engagement, because it determines whether everything downstream is worth doing. We establish the route, confirm it with the bank, structure the first trade to protect both sides, and write the mechanism into a bilingual contract.