Nothing personal, strictly business: Why India buys Russian oil despite Western criticism
India is the world’s third-largest importer of oil
Since the Russo-Ukrainian war broke out earlier this year, the US-led west has imposed a tranche of sanctions on Russia. Since then, the price of Russian oil fell due to the sanctions. While most countries shunned fuel oil from Russia in fear of drawing the US's ire, China and India have become willing consumers of Russian crude.
According to a Bloomberg report, 85% of India's oil needs are met through imports, and cheap supplies provide some economic relief as the country faces elevated inflation. India is the world's third-largest importer of oil. As the inflation rate in the country remains above 7%, India's decision to buy from Russia has been driven by Putin's move against the face of sanctions to steeply undercut international prices for commodities it is banned from selling to the west. Meanwhile, discounts from Russia have offered India economic relief amid the global recession.
India has been careful not to pick sides since the war in Russo-Ukrainian war began. India has historically close ties with Russia, which is also its main weapons supplier. Delhi has built a closer security partnership with Washington seeking to counter Beijing's influence on the theatre of regional geopolitics.
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Delhi's decision to continue buying Russian oil has met with criticism from the west. Biden administration has expressed concern; it has also pointed to Europe's dependence on Russian gas imports, said a CNBC article. However; India along with the US, Australia, and Japan have formed a security partnership - the Quad; the strategic partnership with the US has meant that India has avoided any major repercussions for its continued purchase of Russian commodities.
G7, led by the US said they were engaging in dialogue with India and other countries buying Russian oil to establish some sort of a price cap mechanism to prevent Moscow from benefiting from the energy crisis.
"In the current situation, when inflation is at an all-time high, causing stress to people all over the world, the European Union and other countries in Europe continue to buy far larger quantities than India ever thought of buying or will ever buy," said Indian Trade Minister Piyush Goyal said speaking at the World Economic Forum in May this year, reported Forbes.
He also pointed out that India's purchase in no way violates any sanctions that have been put in place by the West.
India's imports from Russia have more than tripled since its invasion of Ukraine earlier this year largely driven by the purchase of cheap oil. The total value of India's imports from Russia has risen to $8.6 billion since February 2022. In 2021, it was $2.5 billion, reports Times of India reported citing data from the Indian commerce ministry. Between April and May this year, India imported $3.2 billion worth of crude oil from Russia compared to just $210 million in March and zero in February.
"Europe has to grow out of the mindset that Europe's problems are the world's problems but the world's problems are not Europe's problems," said India's External Affairs Minister S Jaishankar during Globsec 2022 Bratislava Forum in June this year; adding "lot of things are happening outside Europe."
He said India's position is very clear regarding the Ukraine crisis - It favors an immediate cessation of hostilities.
"The world is changing, new players are coming, new capabilities are coming but a new agenda must come. The world cannot be that Eurocentric as it used to be in the past," he added.
Pakistan's recently ousted prime minister, Imran Khan even hailed India's foreign policy of recent times and played the video of Jaishankar speaking at Globsec 2022 Bratislava Forum.
During a question and answer session at Globsec 2022, Jaishankar was asked if India is becoming a key point for transshipment of Russian oil to bypass and if that serves India's foreign policy interests.
"Transshipment is when you get it and you sell it to somebody else. I have not even heard of anybody in India thinking along those lines. So yes we do buy Russian oil," he said; adding " Please understand the oil markets. There's an enormous shortage of oil; there's a physical shortage of oil. Getting access to oil is difficult I mean a country like India would be crazy to get oil from somebody and sell it to somebody else."
"Tell me, is buying Russian gas not funding the war? Why is it it's only Indian money and oil coming to India which funds but it's not gas coming to Europe?" he asked.
The Indian foreign minister added: "If countries in Europe and the west and the United States are so concerned, why don't they allow Iranian oil to come into the market? Why don't they allow Venezuelan oil to come into the market? I mean they have squeezed every other source of oil we have and then say 'okay guys you must not go into the market.'"
"Now in terms of our oil purchases, we don't send people out there saying go buy Russian oil. We send people out there saying go buy oil. People at lower levels of income the one thing they do have is the connectivity so there is a lot of awareness I don't think anybody, I mean everybody is mean to put it mildly disturbed at the conflict. I mean they see the pictures, they see that happening.
Asked during the Q&A session that who will India align with - Europe and the US or China and Russia, Jaishankar replied: "Look they are not exclusive."
