While the United States and the United Kingdom have announced further sanctions on Russia following its so-called “special military operation” against Ukraine, India is reportedly planning to increase its shipments to the country by $2 billion as the two nations work out a payment arrangement in local currencies to keep bilateral trade going.
As reported, the central government is in talks with the Kremlin to liberalise market access for a number of Indian-made products. Given that India is a net importer of Russian commodities, the two governments are working on a proposal to settle trade in rupees and rubles, as well as strategies to balance trade.
People familiar with the matter told Bloomberg that India is aiming to sell products from nations that have ceased shipments as a result of sanctions imposed by the US and its allies. Pharmaceuticals, plastics, organic and inorganic chemicals, home furnishings, grains, tea and coffee, milk products, and bovine products are all on the list.
After many countries imposed economic sanctions on Russia in response to its conflict with Ukraine, India has come under fire for increasing oil imports to take advantage of a price drop. American President Joe Biden met with Prime Minister Narendra Modi this week and expressed his willingness to assist India in diversifying its energy supplies, reducing its reliance on Russia.
India’s exports to Russia are currently worth about $3 billion, compared to roughly $68 billion in shipments to the US. According to an analysis, India may easily increase exports to Russia in the top 20 items it requires.
Other commodities India wants to ship to Russia include marine products, textiles & apparel, footwear, machinery, and electronics.
Economic measures to bar new investments in Russia, severe penalties on two Russian financial institutions—Alfa Bank and Sberbank—and crucial significant state-owned companies are among the latest US sanctions. It also adds sanctions imposed on Russian government officials and their families, including President Putin’s adult children and Foreign Minister Sergei Lavrov’s relatives.
Meanwhile, the UK has slapped sanctions on SberBank, Russia’s largest bank, and has vowed to halt all Russian coal and oil imports by the end of 2022.
The UK, EU, and the US have imposed a prohibition on the export of dual-use commodities, such as car parts, that serve both civilian and military purposes.
Additionally, the British government has also imposed sanctions on a Russian paramilitary organisation, Wagner Group, and the Kremlin is thought to use this organisation as a stand-alone force.
According to latest reports, Japan’s Cabinet this week approved additional sanctions against Russia, freezing the assets of over 300 Russian individuals, including President Vladimir Putin’s daughters and the wife of Minister Lavrov.
The export of luxury items to Russia has been prohibited by the United Kingdom and the European Union, including automobiles, high-end fashion, and art. In addition, the UK has put a 35% duty on several Russian imports, including vodka.
The US has banned all Russian oil and gas imports, and the UK will phase out Russian oil imports by the end of 2022.
Germany, meanwhile, has put the opening of the Nord Stream 2 gas pipeline from Russia on hold.