According to analysts from the Institute for the Study of War (ISW), the increase in the volume of goods supplied from India to Russia in order to circumvent Western sanctions is taking place against the background of a large amount of Indian rupees accumulated by the aggressor country due to the sale of oil.
Points of attention
- India is increasing the volume of supplies to Russia to circumvent Western sanctions, leveraging the large reserves of Indian rupees accumulated by Russia from oil sales.
- Indian companies are reportedly exporting dual-purpose technologies to Russia, with monthly shipments of dual-use goods showing a significant increase.
- About one-fifth of the 'sensitive' technologies imported by the Russian defense and industrial base are sourced from India, making India a key player in aiding Russian military operations.
- US and European officials have noted that India has become the second largest supplier of restricted technology to Russia, following China.
- Reports suggest that Russia is covertly purchasing sensitive dual-use electronics from India, utilizing the significant reserves of Indian rupees accumulated through increased oil sales.
What is known about trade between India and Russia to circumvent Western sanctions
Indian companies are reportedly increasing exports of dual-use technology to Russia, partly due to Russia's large reserves of rupees from oil sales to India, analysts said.
ISW refers to information from Bloomberg, whose journalists quote officials from the EU and the USA. US and European officials say India has become the second largest supplier of restricted technology such as microchips, circuits and machines to Russia.
China is in first place.
What is known about the growth of deliveries of sanctioned goods from India to Russia
It said monthly shipments of dual-value goods from India to Russia increased to $60 million in April and May 2024 compared to those months in 2023, and increased to $95 million in July 2024.
Bloomberg, citing official sources, notes that about a fifth of the "sensitive" technologies imported by the Russian defense and industrial base come through India.
As noted, large reserves of Indian rupees in Russia after the sale of Russian oil to India contribute to the growth of Russian imports from India.
ISW analysts also point out that in September of this year, the Financial Times published a story on leaked documents showing that Russia is secretly buying sensitive dual-use electronics from India, using "significant reserves" of Indian rupees accumulated by Russian banks due to increased oil sales to India.
It is unclear to what extent private Indian businesses or state-owned enterprises are exporting these technologies to Russia, but Indian firms appear to be helping Russia support military operations in Ukraine, ISW said.
