Analysts at the Institute for the Study of War (ISW) suggest that the increase in India’s exports of sanctioned goods to Russia has been made possible thanks to Moscow’s reserves of rupees accumulated from its oil sales to India.
US and European officials said India has become Russia’s second-largest supplier of restricted technologies, such as microchips, circuits, and machine tools, following China.
India’s monthly exports of restricted technologies to Russia reportedly doubled to US$60 million in April and May 2024 compared to the same months in 2023 and surged to US$95 million by July 2024.
Nearly 20% of the “sensitive” technology used by Russia’s defence industry is being supplied via India, it is reported.
Analysts noted that Russia’s substantial reserves of Indian rupees, accumulated from oil sales to India, have played a key role in boosting Russian imports from India.
ISW recalls news reports on leaked documents revealing that Russia was covertly acquiring sensitive dual-use electronics from India, utilising “significant reserves” of Indian rupees amassed by Russian banks as a result of heightened oil sales to India.
ISW added that these early reports emerged against the backdrop of Indian Prime Minister Narendra Modi’s visit to Ukraine in August 2024, during which he rhetorically emphasised the principles of international law, including sovereignty and territorial integrity, in conversations with Ukrainian President Volodymyr Zelenskyy.
Reports regarding the transfer of Indian artillery shells to Ukraine via European intermediaries have also heightened tensions in Russo-Indian relations.
Russian forces are reportedly relying on illicitly obtained Starlink terminals to improve combat coordination and the effectiveness of their tactical reconnaissance strike complex (TRSC) in Ukraine as part of an overarching effort to reach technological parity with Ukrainian forces.
Indian enterprises are reportedly increasing exports of dual-use technologies to Russia, in part thanks to large Russian reserves of rupees from oil sales to India.
