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India may bail out Russia by taking up offers to buy crude oil, other commodities at a discount

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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 percent of its oil needs, usually buys only about 1 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.

Iraq was the top crude oil supplier to India in 2021, accounting for 25 percent of the country’s total crude imports.

Saudi Arabia (16 percent), the UAE (11 percent), Nigeria (8 percent) and the US (7 percent) were other key suppliers.

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.

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Meanwhile the UK will send India – a country with its own space programme – £55.3 million in aid in 2021/22, up from £41.5 million in 2020/21.

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 percent, 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.

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