India is trying to bail out Russia at a time when the West is trying to sanction Moscow as punishment for invading Ukraine. According to reports, India is contemplating buying crude oil and other commodities that Russia is offering at heavily discounted price. India, reportedly, is planning to make a payment for this via a rupee-rouble transaction.
India, imports 80 percent of its oil of which it buys 2-3 percent from Russia. However, with oil prices up 40 percent this year, the Indian government is considering raising the import level form Russia as it may assist in lowering the government's soaring energy expense.
India Takes Different Stance
According to a DailyMail.com report, India is trying to make use of the opportunity to lower its own surging energy expense. After Russia came up with the offer of selling oil at a heavily discounted price, the India government is planning to increase its crude oil imports from Russia.
"Russia is offering oil and other commodities at a heavy discount. We will be happy to take that," an Indian government official said on conditions of anonymity. However, the official declined to divulge how much oil was on offer and what the discount was.
The official further said that such a deal would necessitate preparatory work such as shipping, insurance, and obtaining the correct blend of oil and once that gets done, India would accept Russia's offer.
India is the latest country to give a sanction-busting lifeline as the Russian-led war enters its third week. Earlier in late February, China relaxed its wheat import restrictions. Interestingly, neither China nor India have so far officially condemned Russia for invading Ukraine.
Some international traders have avoided Russian oil to abstain from getting embroiled in sanctions. However, the Indian official said that sanctions didn't prevent India form importing crude oil and other commodities.
Understandably, both China and India are treading a diplomatic tightrope in order to maintain critical trade ties with Russia, which is currently experiencing major economic difficulties as a result of sanctions from a large number of countries, including the United States and UK.
Russia has also urged friendly countries to keep their economic and investment links intact. Although India has called for an end to the violence, it has a long-standing relationship with Russia as it buys a large number of defense equipment and weapons from Russia.
India also abstained from a vote at the United Nations condemning the invasion. Moreover, the news of India considering Russia's offers comes despite US officials in recent weeks urging India to distance itself as much as possible from Russia, while acknowledging India's strong reliance on Moscow for everything from weaponry and ammunition to missiles and fighter jets.
Meanwhile, India is trying to make the most of the opportunity. The Indian government, whose import bill might jump by $50 billion in the fiscal year beginning in April, is also looking for cheaper raw materials from Russia and Belarus for fertilizer, as the cost of its subsidy program has risen dramatically.
On the other hand, the West may understand position and the reason behind buying oil at discounted prices. According to an official, West understood India's position, given that it needs to keep its armed forces well supplied amid simmering territorial disputes with China.