Russia may have found a buyer for its cheap oil: India

US officials have said in recent weeks that they would like India to distance itself as much as possible from Russia, while acknowledging that it is heavily dependent on Moscow for everything from weapons and ammunition to missiles and fighter jets.

India did not condemn the invasion of Ukraine and abstained from the UN vote condemning Russian aggression. Russia calls its actions in Ukraine a “special operation” to demilitarize and “denazify” the country.

One insider in India’s security apparatus said the West understands India’s position, given that it needs to well stock its military amid smoldering territorial disputes with China.

India, which imports 80% of its oil, typically buys only 2% to 3% from Russia. But with oil prices up 40% this year, the government is considering raising that figure if it helps cut rising electricity bills.

“Russia is offering oil and other goods at a deep discount. We will be happy to accept it,” said one of the representatives of the Indian government.

The official added that such trade requires preparatory work, including transportation, insurance coverage and getting the right blend of oil, but once that is done, India will accept Russia’s offer.

The officials, who declined to be named, did not say how much oil was offered or what the discount was.

The Ministry of Finance did not respond to an email asking for comment.

Reuters reported that Indian officials are trying to set up a mechanism to exchange rupees for rubles with Russia to continue bilateral trade.

Russia called on countries it calls friendly to maintain trade and investment ties.

In addition to oil, India is also seeking cheaper fertilizer from Russia and its ally Belarus, one official said.

“A difficult story”

Indian officials have said they cannot suddenly replace Russia with other suppliers, especially in the defense sector.

India’s dependence on Russia in terms of military equipment still reaches 60%, despite a significant decline over the past decade.

US officials declined to say whether sanctions would be imposed on India if Russia sent S-400 missile systems in a $5.5 billion deal signed in 2018 for five of them.

The first deliveries of the system began late last year, despite a US law aimed at deterring countries from buying Russian military hardware.

Eli Ratner, Assistant Secretary of Defense for Indo-Pacific Security, said last week at a US congressional hearing that India is diversifying its defense suppliers.

“We recognize that India has a complicated history and relationship with Russia. Most of the weapons they buy belong to the Russians,” he said.

“The good news is that they are in a multi-year process of diversifying their arms purchases outside of Russia – this will take some time. what we have to support.”

British Foreign Secretary Liz Truss also said last week that London should develop closer economic and defense ties with India to help it reduce its dependence on Russia.

Since 2011, New Delhi has reduced imports of defense products from Russia by 53%.

D. Bala Venkatesh Varma, former Indian ambassador to Russia, said that New Delhi should not pay the price of confrontation between world powers.

“This is not a fight that we created,” he said at an online seminar on Monday.

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