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From oil to fertilizers, India is numero uno for Russia

Abhishek Kumar Singh by Abhishek Kumar Singh
30 June 2022
in Trending
From oil to fertilizers, India is numero uno for Russia
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Ever since the current European crisis started to take shape, experts began suggesting that it would drastically cut down Russia’s trade prospects. Well, prospects did dim on the western front, but India stood firm in defying western sanctions. Russia has prioritized India for selling its produces, whether it is oil or fertilizer.

Russia is the top DAP supplier to India

According to a report by The Indian Express, Russia has emerged as the foremost supplier of India’s di-ammonium phosphate (DAP) fertilizer. During the April to July period, India’s total DAP imports from Russia will be 3.5 lakh tonnes at the cost of $920-925 per tonne. It includes cost as well as Freight charge. Russian DAP imports account for more than 36 per cent of India’s total import basket of 9.5-9.8 lakh tonnes during the period. Rest will be availed by traditional suppliers such as China, Saudi Arabia, Morocco, and Jordan.

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Russia in fact went out of the way to avail its fertilizers to India. Due to sanctions, banks were not willing to serve as guarantors of payments. Russian seller PhosAgro took care of it and payments were made by telegraphic transfer.

Russia may have pinned Iraq down

DAP imports from Russia may be new news, but oil imports are not. Over the last few months, Russia has become a prominent oil supplier to India. Last month, it left Saudi Arabia behind by becoming second-largest oil supplier to India. Now, new reports have come out and if we go by some private estimations, then Russia may have left everyone behind in the competition.

According to data compiled by Kpler, in June, a significant jump was observed in the average daily supply of Russian Urals oil. With 12 lakh barrels per day, Russian oil now fulfils 25 per cent of India’s oil needs.The Putin-led country has pushed Iraq at second position with around 10 lakh barrels of oil supply per day. Saudi Arabia is far third with only 6.6 lakh barrels per day. Vortexa figures also put Russia as the top supplier of oil. While, as expected, Bloomberg put Iraq at the top.

Estimations may vary, but it is certain that Iraq and Russia are neck to neck. Even if Russia is not able to beat Iraq on official numbers, it is certain that Russia will beat it in July. Now, why I am saying it? Here is why.

India-Russia bonhomie during crisis

Just after the west forced both diplomatic as well as economic sanctions on Russia, India became one of the first countries to indirectly rescue it. In United Nations, it refused to take sides on the issue. Russia reciprocated with the offer of cheaper oil. Russian oil was a potential replacement for OPEC and India jumped on to the ship. Within 3 to 4 months, the Russian share in Indian oil imports has gone from single-digit to 25 per cent as reported above.

Various other bilateral engagements are on cards. These include the Rupee-Rouble trade and the introduction of RuPay and magic called UPI to Russia. It is a noteworthy development that the stage for the aforementioned initiatives have been set with Russian consumers turning to Indian companies for availability of products hits by western sanctions.

Sky is the limit

Both countries are strong partners on multilateral forums as well. During the recent BRICS Summit, Putin laid down a new concept called BRICS currency basket. It will have both Rouble and Rupee in it. There are more areas to explore. In the past, Russia has been proven arms supplier to India. During Congress era, it was Russia which used to save us from US’ mayhem on diplomatic forums. We are still indebted to its timely intervention in Bangladeshi liberation war.

Only sky is the limit for cooperative framework between both countries. Russia needs a reliable partner and there could be no better option than India. Indian market can single-handedly resurrect the Russian economy, given proper modalities are chalked out.

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