India’s Russian Realignment
By Umer Beigh
India’s Realignment with Moscow Shakes its Relationship with the US
On July 9, Prime Minister of India Narendra Modi concluded his two-day Russia visit on a high as he signed nine memorandums on bilateral trade and cooperation following which President Vladimir Putin awarded him with Russia’s highest civilian honor, the “Order of Saint Andrew the Apostle”.
Modi’s visit superseded a day before the NATO Summit began in Washington. The cordial pictures of Modi and Putin warmly greeting, hugging, and riding a golf cart at a private residence, however, weren’t well received by India’s Western partners.
India betting on Moscow and dodging the potential risk of upsetting its Western partners comes from the apparent fear of China dominating the Eurasian landmass. With increased Russia’s reliance on China, PM Modi initiated embracing President Putin amidst the continuous flare-up in Ukraine.
On July 12, US Ambassador Eric Garcetti expressed his frustration with India, cautioning: “…I respect that India likes its strategic autonomy. But in times of conflict, there is no such thing as strategic autonomy. We will, in crisis moments, need to know each other. ”
Professor Swaran Singh who teaches International Relations at Jawaharlal Nehru University agrees that Indian leadership visiting Moscow often invokes scrutiny from Beijing to Washington who looks at the Annual Summit carefully and analyzes its implications. Swaran asserted.
I feel PM Modi took care of it, to make sure that his government is not seen wavering or leaning on either side. India continues to assert that the central focus of its foreign policy is strategic autonomy.
Ukraine crisis
Since the Russia-Ukraine conflict, the proportion of oil exports from Russia coming to India has increased from almost 0.2% in 2022 to 40% in 2024.
India used to buy almost no Russian oil because of the long distance from Russian seaports to India; this situation has changed after Moscow’s invasion of Ukraine,
Lauri Mullyvirta, an analyst at CREA notes.
Indian refiners, which rarely bought Russian oil previously, have gone on importing 970,000-981,000 barrels per day in fiscal year 2022-2023. The Jamnagar refinery in the Indian state of Gujarat owned by Reliance Industries has since turned out to be the highest purchaser (34% of crude oil imports) importing 400,000 barrels per day.
For a single cargo, the trader in theory is viewed to make 10 to 15 million dollars. According to the Research on Energy and Clean Air (CREA) report from December 2022—some thirteen months since the oil price cap took effect—more than one-third of India’s exports of oil products to sanctioning countries was derived from Russian crude ($6.65 billion).
Indians selling Russian crude oil to EU
The Indian refinery based in Gujarat and elsewhere in Mumbai has been converting this crude oil into gasoline and subsequently selling it to the European Union. Observers accuse India of setting up entirely different supply chains that ensure that Russian crude oil continues to flow irrespective of it being below the price cap or over the price cap. The credit ranking agency ICRA estimated that India saved about $13 billion by buying steeply discounted Russian oil in 2022.
Last year, 20 out of 27 EU countries imported refined products from India, with the Netherlands importing 24% of the total volume.
Despite a steady volume of crude oil imports over recent years, India’s import bill has decreased significantly from $157.5 billion in 2023 to $132.4 billion in 2024, highlighting a reduction in oil prices or improved terms of trade.
However, some reports have raised apprehension of “shadow oil trading” accusing India of exporting the fuels imported from Russia without proper regulations. On May 16, EU High Representative for Foreign Policy and Security, Josep Borrel complained that “if diesel or gasoline is entering Europe . . . coming from India and being produced with Russian oil, that is certainly a circumvention of sanctions and member states have to take measures.”
India’s embrace of its all-weather-friend Moscow in all likelihood displeased the Joe Biden-led administration. “That India buys Russian oil, it’s normal. And if, thanks to our limitations on the price of oil, India can buy this oil much cheaper, well the less money Russia gets, the better,” Borrell said. “But if they use that in order to be a center where Russian oil is being refined and by-products are being sold to us . . . we have to act,” he added.
India-Russia Bilateral Ties
The Ukraine war and the subsequent response from Western countries to isolate Russia allowed India a rare opportunity to improve its import energy for cheaper rates from Russia.
Russia’s ties with India are primarily in military defense and science and technology. The massive import of crude oil has led to a trade imbalance which was deemed to be PM Modi’s first priority to encourage leadership in Russia to invest more in India.
In 2005, when India was struggling with its nuclear negotiation with the US, Russia stepped in to support the nuclear power program. The Soviets took active participation in the 1971 war by pampering India to manipulate the creation of Bangladesh to penalize Pakistan for bringing the US closer to China.
A report by the Stockholm International Peace Research Institute estimates that India’s arms import was as much as 76% between 2009 and 2013. However, with the advent of the superior technology offered by the US and France, India has felt the need to diversify its purchase of weaponry, this number has gone down to 36% between 2019 and 2023. Nevertheless, India remains heavily dependent on Russia to purchase spare parts and ammunition.
Amid the growing Chinese power in the region, India is poised to acquire greater assistance from the US in terms of its economic and military modernization.
Pankaj Saran, the former Deputy National Security Advisor of India, admits that the India-Russia relationship goes a long way:
Tracing its origin in the colonial period of Indian foreign policy. It has been a constant and survived the improvement of Indo-US relations, and the rise of China. It has also survived the multiple wars fought in the Middle East, in Afghanistan, and the collapse of the Soviet Union.
Saran has served as Indian ambassador to Russia, he suggested that Indian perception towards China is something that dominates the Indian strategic mind space: “For India that is primarily the main strategic challenge that doesn’t mean China is an adversary. But we need to make policies and strategies on how to deal with China,” he noted.
India does want to prevent Russia from becoming a Chinese satellite but whether New Delhi has the economic and technological heft to stop it remains to be seen. Knowing its limitations, the US still sees India as the best bet to counter China in the Asia-Pacific. In the midst, PM Modi’s embrace of Moscow shows the nation continued to cling to its past geopolitical stance despite his assertions of reimagination in the past few years.
