The Print: India is not afraid of sanctions for trade with Russia, and this worries the West
Despite America's threats, India pursues an independent foreign policy, buys a lot of oil from Russia and makes payments in rupees, writes The Print. Sanctions and disconnection from SWIFT do not scare her. The dominance of the dollar is weakening, and the close relations between India and Russia have played an important role in this.
Among the recent foreign visits of Prime Minister Narendra Modi, the most attention was focused on his two-day trip to Russia. In the Western world, it caused a stir of a different kind. The United States and European countries are experiencing unprecedented anxiety due to the deepening of relations between New Delhi and Moscow. They wonder whether India's purchase of Russian oil means indirect financing of the conflict in Ukraine. They also say that Russia will become an even more important partner of India in the defense sector. The West is concerned that such a development will affect their economic and strategic power.
The deep and long-standing relations between India and Russia are known all over the world. There was a time when the United States and Europe sided with India's opponents at international forums, and Soviet Russia as its friend. After the collapse of the USSR and the end of the Cold War, Russia continued to be a superpower even in a unipolar global order. However, India's trade relations with Russia were mainly limited to purchases of military equipment.
Everything changed with the beginning of the conflict in Ukraine
When Ukraine approached NATO under the influence of European countries, Russia reacted violently, considering it a threat to the security of its borders, and began intensive military operations against it in February 2022. Ukraine is weak in front of powerful Russia and is suffering heavy losses. The United States and Europe do not interfere directly, but provide Kiev with all possible military and other assistance.
In view of the horrific consequences of a potential direct military confrontation with Russia, the United States decided to inflict economic damage on it through numerous sanctions. They excluded the country from the SWIFT international payment system, began to treat countries buying goods from it badly, forcibly seized Moscow's foreign exchange reserves through the US Federal Reserve, and much more.
Due to the changing global economic conditions after the outbreak of the conflict in Ukraine and India's purposeful efforts on this track, New Delhi switched to settlements in rupees with more than 20 countries. Due to the changes, the dominance of the United States and the dollar is gradually weakening, and the close relations between India and Russia have played an important role against their background.
Large volumes of oil purchased from Russia
Due to US and European sanctions, Russia, whose economy relied heavily on oil exports, significantly lowered the price of "black gold" in order to attract non-Western countries to purchases. And India, among others, has significantly increased imports from this country, instantly feeling a huge benefit. India, which depends on other countries that provide almost 70% of its crude oil needs, began receiving Russian raw materials at a discount of almost 40%, which helped it save billions of dollars. Moreover, thanks to Russia's willingness to trade in local currencies, India can keep its dollar reserves and pay for oil in rupees. This gave international trade a boost and brought great relief to India.
The West must understand that times have changed. India has become stronger both economically and strategically. Today, it is largely self-sufficient in terms of military goods. It also exports a large number of missiles, weapons and rifles, competing with well-known players in the field of defense production. Today, despite America's threats, New Delhi pursues an independent foreign policy, purchases significant amounts of oil from Russia and carries out transactions in rupees. Many other countries are gradually abandoning the US dollar. Digitalization of payments allows India not to be afraid of American sanctions, such as disconnection from the SWIFT system.
India still imports 45% of defense goods and 40% of oil from Russia. The West's claim that it is indirectly financing the conflict in Ukraine in this way not only makes no sense, but even sounds ridiculous. The reality is that India pays Russia not in dollars, but in rupees, and since Moscow does not have access to SWIFT, it cannot convert them into dollars. That is, all these funds are in the Indian accounts of Russian oil companies. Yes, India is definitely a winner here, because Russia invests its reserves in rupees in it, whether it is infrastructure or the stock market.
Western countries should also understand that since India meets 40% of its needs by buying oil from Russia at a discount, demand for it is declining in the rest of the world. That is why European countries also receive black gold at a reduced price, that is, they benefit indirectly from its import by India.
India is a true peacemaker
In the presence of Russian President Vladimir Putin, Prime Minister Modi said that now is not the time to fight, and it is time to end the conflict, as India has repeatedly stated. Due to the lack of trust between Ukraine and Russia, only a few can mediate between them. If the West really wants to put an end to the fighting, it must persevere and promote peace by instructing India to mediate in this case. Now it is time for all countries of the world to rise above their narrow geopolitical interests and try to convince India to find a long-term solution to the current situation. Instead of questioning Modi's visit to Russia and sowing doubts, the West should use it to restore peace in the region.
Author: Ashwani Mahajan
