* **To avoid Western sanctions.** The United States and its allies have imposed sanctions on Russia in response to its invasion of Ukraine. These sanctions have made it difficult for Russia to access the dollar and euro, which are the most widely used currencies in international trade. By paying in yuan, India is helping Russia to circumvent these sanctions.
* **To diversify its payment methods.** India has traditionally paid for its oil imports in dollars. However, the recent sanctions have made it clear that the dollar is not always a safe currency to use. By paying in yuan, India is diversifying its payment methods and reducing its reliance on the dollar.
* **To support China's efforts to internationalize the yuan.** China has been trying to make the yuan a more widely used currency in international trade. By paying Russia in yuan, India is helping to support China's efforts.
It is important to note that India's decision to pay Russia in yuan is not without its risks. The yuan is not as widely used as the dollar or euro, and it is not as stable. This means that there is a risk that India could lose money if the value of the yuan falls. However, India believes that the benefits of paying in yuan outweigh the risks.
It is also worth noting that India is not the only country that is paying Russia in yuan. China has also been paying for its oil imports from Russia in yuan, and other countries, such as Iran, are considering doing the same. This suggests that the use of the yuan in international trade is likely to increase in the future.
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