One year into the Ukraine war, goods trade between Russia and India has touched new highs. The New Delhi-Moscow relations have withstood the West’s pressures, and bilateral trade has been the biggest benefactor as well as a catalyst in this transformation. However, a sharp surge in imports from sanctions-hit Moscow has made trade figures overwhelmingly one-sided. Historically, India’s imports from Russia have stayed under five times its exports to the country, with the ratio touching 4.1 in 2017-18, previously the highest under the Narendra Modi government. But in 2022-23 till January, imports have been 15 times the exports.
India’s imports from Russia have witnessed a significant surge during the April-February period of this fiscal year, reaching a staggering $41.56 billion, as per the latest data from the commerce ministry. This figure is nearly five times higher than the previous year’s imports.
The primary reason behind this exponential rise is the increasing volume of crude oil shipments from Russia to India. Russia was India’s 18th largest import partner in 2021-22, with imports totaling $9.86 billion. From just 0.2 percent of all oil imported by India, Russia supplied 28 percent of the total oil imported in January.
Prior to the Russia-Ukraine conflict, Russia held a market share of less than 1 percent in India’s import basket. However, as of January, Russia’s share of India’s oil imports surged to 1.27 million barrels per day, accounting for a 28 percent share, as reported by energy cargo tracker, Vortexa.
India, the third-largest importer of crude oil in the world, has been taking advantage of discounted prices on Russian oil, which became available when some Western countries chose to boycott it as a means of punishing Moscow for its invasion of Ukraine.
According to the ministry’s data, there was an increase in imports from China and the UAE during the period of April to February. The imports from China went up by approximately 6.2 percent amounting to $90.72 billion, while the imports from the UAE saw a more significant increase of 21.5 percent, totaling $48.88 billion.
Additionally, India experienced a substantial increase in imports from the US, with a growth rate of around 19.5 percent, reaching a total of $46 billion, during the mentioned period.
On the export front, the US emerged as the top destination for Indian exporters during the 11-month period, accounting for 17.5 percent of the country’s total outbound shipments.
Exports to the US increased to USD 70.99 billion as against USD 68.447 billion during April-February period of 2021-22.
Furthermoew, it was observed that during the April-February period, exports from India to the UAE surged to $28.63 billion compared to $24.95 billion recorded in the corresponding period of the previous year. Conversely, exports to China during the same period decreased to $13.64 billion as compared to the figure of $19.81 billion reported during the April-February period of 2021-22.
Enhancing trade and economic cooperation between India and Russia is a key priority for the political leadership of both the countries as is clear by the revised targets of increasing bilateral investment to US $ 50 billion and bilateral trade to US $ 30 billion by 2025.
