Despite sanctions, India's purchases of Russian coal have increased

20 Jun 2022 , 11:21 AM

Despite worldwide sanctions against Russia, India’s sales of Russian coal have increased in recent weeks, as sellers offer discounts of up to 30%, according to two trade sources and data seen by Reuters.

Russia, which is under harsh Western sanctions as a result of its invasion of Ukraine, warned the European Union in April that sweeping coal penalties would backfire because the fuel would be diverted to other markets.

While calling for a stop to the violence in Ukraine, India has refrained from criticizing Russia, with whom it has long-standing political and security relations. New Delhi defends its imports of Russian commodities as part of a broader attempt to diversify supply, claiming that a sudden halt would raise global prices and harm its citizens.

Officials from the United States have warned India that there is no embargo on Russian energy imports, but they do not want to see a “rapid acceleration.”

Despite the fact that European importers avoid doing business with Moscow, Indian customers are snapping up large amounts of Russian coal despite the high freight expenses.

According to secret Indian government statistics examined by Reuters, its purchases of coal and associated items increased by more than sixfold in the 20 days through Wednesday compared to the same time a year ago, reaching $331.17 million.

Similarly, Indian refiners have snatched up inexpensive Russian oil that has been spurned by Western countries. The value of India’s oil trade with Russia increased by more than 31 times to $2.22 billion in the 20 days leading up to Wednesday, according to the statistics.

On Saturday (18-06-2022), India’s trade ministry did not reply to a request for comment. “The Russian dealers have been generous with payment ways, taking payments in Indian rupee and the United Arab Emirates dirham,” according to one source. “The savings are appealing, and the trend of increased Russian coal purchases is likely to continue.”