#FactCheck -False Claim About Indian Ships Paying Iran in Yuan to Pass Strait of Hormuz Goes Viral Amid Geopolitical Tensions

Research Wing
Research Wing
Innovation and Research
PUBLISHED ON
May 19, 2026
10

Executive Summary


Amid the ongoing geopolitical tensions involving the US, Israel, and Iran, and reports of disruptions in the Strait of Hormuz affecting cargo ship movement and global crude oil prices, several posts on social media have made a viral claim. The posts allege that Indian cargo vessels are being allowed to pass through the Strait of Hormuz after payments to Iran were made in Chinese currency, the yuan. The claim has been widely circulated from certain social media accounts, suggesting a shift in India’s trade and payment arrangements. However, a fact-check by CyberPeace Research Wing has found the claim to be false.

Claim

A social media user “MEHF voice 2.0” shared a viral post (archived link), claiming that an Indian oil tanker secured passage through the Strait of Hormuz by making payments in Chinese yuan. The post further suggested that India had formed a new alignment with China, bypassing the US dollar system.

Fact Check

Due to US sanctions, Iran is excluded from the international banking network SWIFT, which prevents direct trade settlements in US dollars or euros. As a result, India and Iran conduct trade through a specially designed rupee–rial payment mechanism. According to a Ministry of Commerce and Industry release (based on a written reply in Parliament), India and Iran established this arrangement to facilitate bilateral trade using local currencies instead of the US dollar.

Further, information from the Indian Embassy in Tehran notes that rupee-based payments are processed through UCO Bank and Iranian banks with vostro accounts, enabling trade settlement outside sanctioned banking channels. IDBI Bank has also been part of efforts to expand rupee-based transactions with Iran.

The Ministry of External Affairs’ official fact-check handle has also debunked this claim, confirming that it is false.

Conclusion

The viral claim that Indian oil tankers are paying in Chinese yuan to pass through the Strait of Hormuz is false. India and Iran conduct trade settlements through a rupee–rial payment mechanism, not through the Chinese currency.

PUBLISHED ON
May 19, 2026
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#FactCheck
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