India looks to bail out Russia with discount crude oil purchase

India looks to bail out Russia as it considers taking up Moscow’s offer to buy crude oil at discount prices amid Western sanctions

  • India may take Russian offer to buy crude oil, other supplies at discounted price
  • New Delhi exploring logistics but otherwise ready to take up offer, officials said 
  • India is latest country to offer a sanction-busting lifeline to Russia, joining China 
  • Beijing lifted wheat import restrictions after the invasion of Ukraine in February

India may bail out Russia by taking up an offer to buy crude oil and other commodities at a discount despite Western attempts to isolate Moscow through sanctions.  

India, which imports 80 per cent of its oil needs, usually buys only about 2-3 per cent from Russia. But with oil prices up 40 per cent so far this year, the government is looking at increasing this if it can help reduce its rising energy bill.

‘Russia is offering oil and other commodities at a heavy discount. We will be happy to take that,’ an Indian government official said, declining to elaborate on how much oil was on offer and what the discount was. 

The official added that such trade required preparatory work including transportation, insurance cover and getting the right blend of crude, but once that was done India would take Russia up on its offer. 

India is the latest country to offer a sanction-busting lifeline as the Russian-waged war enters its third week after China lifted wheat import restrictions at the end of February. Imports had been restricted amid concerns over Russia’s measures to prevent plant diseases, particularly in agricultural crops.

Neither Beijing nor New Delhi have condemned the invasion in Ukraine and both abstained from a vote at the United Nations calling out Russian aggression last month. 

Both governments are walking a diplomatic tightrope in order to preserve their vital trade links with Russia which is now facing serious economic woes after being targeted by sanctions. 

India may bail out Russia by taking up an offer to buy crude oil and other commodities at a discount despite Western attempts to isolate Moscow through sanctions (pictured, Russian President Vladimir Putin and Indian Prime Minister Narendra Modi meeting in December 2021)

India, which imports 80 per cent of its oil needs, usually buys only about 2-3 per cent from Russia. But with oil prices up 40 per cent so far this year, the government is looking at increasing this if it can help reduce its energy bill (pictured a Russian diesel plant in Irkutsk)

India has walked a diplomatic tightrope over Russia’s invasion of Ukraine, refusing to condemn the war and abstaining from a UN vote calling out Moscow’s aggression last month

US officials have said in recent weeks they would like India to distance itself from Russia as much as possible, while recognising its heavy reliance on Moscow for everything from arms and ammunitions to missiles and fighter jets.

One person within India’s security apparatus said the West understood India’s position, given that it needs to keep its armed forces well supplied amid simmering territorial disputes with China.

Reuters has reported that Indian officials are trying to set up a rupee-rouble mechanism with Russia to continue bilateral trade. 

Russia has urged what it describes as friendly nations to maintain trade and investment ties.

Apart from oil, India is also looking for cheaper fertiliser from Russia and its ally Belarus, according to one of the officials. 

Indian officials said they could not suddenly replace Russia with other suppliers, particularly in the defence sector.

India’s dependence on Russia for its military hardware still runs as high as 60 per cent, despite a significant reduction over the last decade.

US officials have declined to say if India would be sanctioned should Russia send S-400 missile systems as part of a $5.5 billion deal signed in 2018 for five of them.

Neither Beijing nor New Delhi have condemned the invasion in Ukraine and both abstained from a vote at the United Nations calling out Russian aggression last month 

The move to keep the wheat market open was reportedly part of a deal between Moscow and Beijing concluded earlier this month and is the latest sign of growing ties between the two states

Initial supplies of the system started late last year despite a US law aimed at deterring countries from buying Russian military hardware.

Ely Ratner, US Assistant Secretary of Defense for Indo-Pacific Security Affairs, told a US Congress hearing last week that India was diversifying its defence suppliers.

‘We recognise that India has a complicated history and relationship with Russia. The majority of the weapons that they buy are from the Russians,’ he said.

‘The good news is that they are in a multi-year process of diversifying their arms purchases away from Russia – that’s going to take some time. 

‘But they are clearly committed to doing that, including the indigenisation of their own defence industry and that’s something we should support.’

British Foreign Minister Liz Truss also said last week that London should pursue closer economic and defence ties with India to help it reduce its reliance on Russia.

Since 2011, New Delhi has cut its defence imports from Russia by 53 per cent.

D. Bala Venkatesh Varma, a former Indian ambassador to Russia, said New Delhi should not be expected to pay a price for a standoff between global powers.

‘This is not a fight we have created,’ he told an online seminar on Monday.

It comes days after Ukrainian President Vlodymyr Zelensky asked US President Joe Biden to cut Russia off from international waters during their Friday phone call.

His requests included more sanctions on Kremlin elites and further blocking Russia out of global trade, people familiar with the call told CNN.  

Two people were killed on Monday during a Russian missile attack on a Kyiv apartment block. One person died when a rocket struck the residential complex while a second was killed by debris from a second missile being intercepted

A view of damaged area after fragments from a Tochka missile which was allegedly launched by Ukrainian forces has fallen in Donetsk region, killing 20 civilians, injured 9 others, on March 14

A child looks on a she stands in front of a destroyed apartment building following shelling in Kyiv on March 14

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