Do We Trade With Russia? Key Trade Flows

Who actually trades with Russia now

The question is rarely 'does anyone trade with Russia' - it is 'who is on the other side of the contract'. After 2022 the geography of Russian trade rotated rather than collapsed. Western corporate exits left gaps that were filled largely by Asian, Gulf and CIS suppliers and buyers, and this is visible in investment as well as goods: 75% of foreign direct investment now comes from countries Russia classifies as friendly, against 25% before (UNCTAD via Izvestia, 2025).

That shift matters for pricing and for competition. If you are a Turkish machinery exporter, an Indian pharmaceutical supplier, a Chinese electronics distributor or an Emirati trading house, you are frequently negotiating against fewer Western competitors than was the case before 2022 - and often against other firms from your own country.

• China - machinery, vehicles, electronics, consumer goods inbound; energy, metals, timber, fertilisers outbound
• India - refined petroleum products, pharma and agri inputs inbound; crude, fertilisers, sunflower oil outbound
• Turkey - construction materials, textiles, food inbound; energy and metals outbound
• UAE and the wider Gulf - re-export, finance, logistics, gold and agri trade
• Belarus, Kazakhstan, Uzbekistan, Armenia, Kyrgyzstan - industrial components, food, transport services under EAEU rules

What actually crosses the border

Russian exports remain commodity-heavy: crude and refined products, natural gas and LNG, coal, ferrous and non-ferrous metals, gold, timber, grain, fertilisers and petrochemicals. In a few commodities Russia is not a marginal supplier but the dominant one - it accounts for 44% of world palladium as the number one producer (USGS, 2025). Agricultural exports deserve separate attention from oil: wheat, sunflower oil and fertiliser are frequently outside the scope of sanctions regimes, which is why trade in them never fully stopped.

Imports are the mirror image of an economy that lost a large share of its Western supply base. Machinery and spare parts, vehicles and components, electronics, chemicals, pharmaceuticals, packaging and consumer goods are the categories where foreign suppliers still find demand. Industrial equipment and components are the segment where Russian buyers are most actively looking for new, stable counterparties rather than one-off deals.

One structural point for traders: import substitution has advanced in food, some chemicals and simple components, but not in complex machinery or high-end electronics. That is where the persistent import demand sits.

• Exports: energy, metals, palladium, gold, grain, fertilisers, timber, petrochemicals
• Imports: machinery, vehicles and parts, electronics, chemicals, pharma, packaging, consumer goods
• Long-cycle items - industrial equipment, spares, service contracts - are the hardest to replace and the most sought after

How the money moves - settlement in 2026

The single biggest operational change is settlement. 86% of Russian exports are now settled in rubles and the currencies of friendly countries (Bank of Russia, 2025). In practice that means a trade contract may be priced in dollars or euros but executed in yuan, dirhams, rupees, rubles or a combination, often through non-Western banks with correspondent lines that do not touch the Western system.

For an importer or exporter this creates three practical questions: which bank on each side can actually receive the money, what documentation that bank requires to pass its own compliance check, and how long the transfer takes. Delays are common, and a contract that assumes a two-day settlement is a contract that will be breached.

Retail and B2B domestic payments inside Russia are close to fully digital, with 88% of retail payments cashless (Bank of Russia, 2025), so once funds are inside the country, movement is fast. The bottleneck is almost always the cross-border leg, not the domestic one.

• Expect multi-currency contracts rather than a single hard currency
• Agree in advance which bank receives, which bank sends, and which currency pair clears
• Build a realistic settlement timeline into delivery terms and penalties
• Never route a payment through an intermediary that cannot explain its own compliance basis in writing

If you are in the US or the UK

US and UK trade with Russia still exists, but it is narrow, category-specific and heavily conditioned by licensing. Broad prohibitions cover most goods, services, finance and shipping-related activity, while a defined set of categories - typically medicines, medical devices and certain food and agricultural products - sits outside or partially outside the restrictions. The details differ between the two jurisdictions and change with each new package, so the only reliable approach is a fresh legal review per transaction, per counterparty, per product code.

Practical points that repeatedly catch companies out: restrictions often follow the goods and the end user, not just the direct counterparty; affiliated or re-exporting intermediaries can pull a compliant-looking deal back into scope; and documentary requirements from banks are usually stricter than the letter of the regulation. An independent sanctions lawyer in your own jurisdiction, not the counterparty's, is the right adviser here.

There is no general prohibition on holding a Russian counterparty relationship or on information exchange, but any transaction with a payment, logistics or technology component needs to be assessed on its own facts. General guidance from an article like this is not a substitute for that assessment.

• Treat every deal as a separate licensing question, not as a category exemption
• Check the product code, the end user and the ownership chain, not just the invoice party
• Expect banks to demand more documentation than the regulation strictly requires
• Do not assume re-export through a third country removes the restriction

If you are in the CIS, the Gulf or Asia

For counterparties in Kazakhstan, Uzbekistan, Armenia, Kyrgyzstan and Belarus, trade runs inside the EAEU framework, which means a common customs tariff for goods entering the union and simplified movement of goods between member states. That is a genuine advantage, but it comes with one large caveat: rules of origin are audited, and goods that merely transit a member state without genuine processing do not acquire EAEU origin. Getting this wrong creates a customs liability that lands on the importer, not the seller.

For Gulf, Chinese, Indian and Southeast Asian companies there is no equivalent bloc, so each deal is bilateral. The practical advantages are direct: fewer origin complications, more freedom on invoicing currency, and access to the special regimes that give a 0-5% profit tax rate in designated zones (Federal Tax Service, 2025) compared with the standard 25% corporate profit tax (Federal Tax Service, 2025).

Standard VAT on domestic supplies and imports is 22% since 1 January 2026 (Federal Tax Service, 2026), which is a real cost line to model before pricing. Bear in mind that the Bank of Russia key rate stood at 14% in September 2026, so the cost of financing working capital or a deferred payment is materially higher than in most Gulf or Chinese markets - factor that into payment terms.

• EAEU: free movement internally, but origin must be genuine, not paper
• Non-EAEU partners: no bloc rules, but negotiate VAT and payment terms explicitly
• 0-5% profit tax regimes exist in designated zones; eligibility depends on status and activity
• Local currency financing is expensive relative to Gulf and Asian benchmarks; prefer prepayment or short tenors

How a trade deal is actually put together

The sequence is unglamorous and predictable, and most failed deals fail at step two or three rather than at price negotiation.

First, counterparty verification: legal entity status, beneficial owners, whether the company or any owner appears on a sanctions or export-control list in your own jurisdiction, and whether the intended goods sit in a restricted category. Second, the payment route: confirm with both banks, in writing, that they will handle the currency and the counterparty before you sign anything. Third, contract structure and currency, including which law governs and where disputes are heard - arbitral seats outside the counterparties' home jurisdictions are common and worth agreeing early. Fourth, certification and customs: most goods entering Russia need EAC conformity documentation, and getting this wrong is a common reason for goods sitting in a warehouse for months.

• Verify the entity and the ownership chain in your own jurisdiction, not theirs
• Confirm the banking route in writing before signing
• Fix currency, governing law and arbitration seat in the contract
• Start EAC certification and customs classification before shipping, not after

The risks that actually cost money

Compliance risk is the first and largest. Secondary sanctions exposure can affect a company that never touches Russia directly, and banks are the enforcement point - a relationship can be frozen by a correspondent bank without any regulator acting. Independent compliance counsel is the only defensible position.

Logistics and insurance are the second. Freight routes into and out of Russia are longer and more expensive than before 2022, insurance capacity for certain cargoes is limited, and some shipping lines and insurers will simply decline. A deal that looks profitable on goods cost alone is often marginal once freight, insurance and financing are added.

Currency and payment risk is the third. Even with 86% of exports settled in rubles and friendly-country currencies (Bank of Russia, 2025), transfers can be returned, delayed or blocked, and a returned payment after goods have shipped is the worst position a trader can be in. Prepayment, letters of credit through banks both sides accept, and staged delivery are the standard defences.

Finally, contract enforcement. Russian courts work, but enforcing a Russian judgment abroad, or a foreign judgment inside Russia, is not automatic. Choosing the arbitration seat carefully at the drafting stage is worth more than any clause written after a dispute starts.

This article is general information about how cross-border trade with Russia is structured. It is not investment, legal or tax advice, and any specific transaction requires independent advice from a qualified professional in your own jurisdiction.

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