The contract between Moscow and New Delhi on supplies of Russian S-400 air defence systems will be settled in Roubles, according to Russia’s Deputy Prime Minister Yuri Borisov

The move comes as Moscow intensified recent efforts to make de-dollarisation of the Russian economy one of the main pillars of its policy. The Kremlin is looking for an alternative to the US dollar in mutual settlements with international partners. The key point of the plan is to make it more profitable for Russian exporters and importers to use Roubles instead of dollars.

Earlier this month, President Vladimir Putin said safety and security of the economy was the major driver behind the decision to eliminate the role of the US dollar. The measure reportedly comes amid threats from Washington to cut Russia off from dollar transactions and hit Russia’s sovereign bonds with another round of sanctions.

The Indian government has been increasing military cooperation with Russia. In early October, Russia and India agreed on supplies of Russia's S-400 missile systems worth $5.4 billion. The deal was clinched during Putin's two-day visit to New Delhi. The country is also reportedly planning to buy Russian T-14 Armata tanks and guided-missile frigates, and could potentially develop submarines and next-generation fighter jets in cooperation with Russia.

The S-400 is a long-range air defence system designed to protect strategically important sites like key infrastructure objects, military units or ballistic missile launch silos against enemy aircraft and missiles. The system is capable of destroying aerial targets at an extremely long range of up to 400 kilometres (nearly 250 miles).

Last week, the White House, which had previously threatened India with sanctions over Russian arms purchases, said the US could give the deal a waiver, if New Delhi agrees to buy American F-16 jets.