The City of London must be willing to accept some pain should the EU choose to rollout hard-hitting sanctions against Russia, according to the trade minister Lord Livingston.

The EU is believed to be considering banning Russian state-owned banks and companies from selling debt or stock on the EU markets. Ministers will vote on Tuesday on how wide-reaching the embargo should be.

London is Europe's largest financial hub and has a large concentration of Russian companies and wealthy individuals. It's to be expected, then, that the City will suffer from extended measures.

Lord Livingston is reported as saying: "I've heard some people say 'oh, the City of London isn't going to take the pain' but that's not true. We've got to make sure that the whole of Europe thinks that the UK is absolutely willing to take its share of the pain and do the right thing."

His comments come as the spotlight on the EU's trading relationship with Russia intensifies. The Guardian reports that the UK's export guarantee body UK Export Finance (UKEF) underwrote more than £100m in exports to Russia in 2013. Some of the support was extended to an airline leasing company linked to the state-arms provider Rosboronexport.

A UKEF spokesperson has made it clear to IBTImes UK, however, that "UKEF has not provided support for any military goods to Russia under this government".

BP's relationship with Rosneft has also been under surveillance for some time. The British company holds a minority stock in the Russian oil giant following the TNK joint venture of 2012. With Rosneft CEO Igor Sechen facing sanctions in the EU and Rosneft itself being sanctioned by the US, the connection becomes murkier.

Lord Livingston added: "I think there will be a range of sanctions and the best ones are the ones that hurt – that hurt the people you are trying to sanction."

The rhetoric of the former BT CEO represents an escalation on the part of the British government. Prime Minister David Cameron has thus far sought to protect the UK's financial sector and while the trade minister's remarks are unbinding, there seems to be an air of acceptance that some pain will be required.

The German foreign minister Frank-Walter Steinmeier told German radio yesterday that his government will support economic sanctions on Russia provided each member state accepts their portion of the burden.

"If there are negative consequences, then they must be borne across Europe as a whole," he said.

This too represents a departure: Germany was initially stern in its opposition to sweeping sanctions, since it is dependent on Russian gas imports and exports high volumes of machinery and equipment to Russia.

With France voicing similar support over the weekend, it would seem that the ministers of Europe are finally singing from the same hymn sheet on an issue which has been hugely divisive. Officials in Paris had previously lobbied Brussels to permit the sale of two warships, which had been agreed on a contract of €1.2bn before the Ukraine crisis kicked off.

While Francois Hollande is still eager to honour the delivery of the first ship, there now seems to be a willingness to veto the second.

Russia is bracing itself for the result of Tuesday's discussions. Alexander Kornilov, senior oil and gas analyst at Alfa Bank in Moscow, told IBTimes UK that "If the EU finally goes ahead with the sanctions which are currently on its mind it would be hard for Russia and Rosneft".

*Story updated on July 29 to include comment from UKEF.