Russian Prime Minister Alexander Novak revealed that India has started paying for oil from Moscow in yuan, even though most of the transactions are still being done through rubles, reported Russian news agency TASS.
“I am aware that such payments have started. I believe the percentage is small at present because payments are largely made in rubles,” the Russian news agency reported quoting the deputy PM.
Indian refiners bought ₹2.5 billion (₹25,597 crore) worth of Russian crude in September, trailing China’s ₹3.2 billion, according to Helsinki-based Centre for Research on Energy and Clean Air (CREA).
Traditionally reliant on Middle Eastern oil, India, the world’s third-largest oil importer, significantly increased its imports from Russia following the February 2022 Ukraine invasion.
Western sanctions and reduced European demand made Russian oil available at steep discounts. As a result, India’s Russian crude imports surged from under 1 per cent to nearly 40 per cent of its total crude oil imports in a short span.
India’s oil ties
At present, India and China are the two top buyers of Russian seaborne crude exports, taking advantage of the discounted prices Russia has been forced to accept after European buyers shunned purchases and the U.S. and the European Union imposed sanctions on Moscow for its invasion of Ukraine in February 2022.
Meanwhile, India has the capacity to purchase an additional $15 billion of oil from the US, a senior commerce ministry official said Wednesday, signalling New Delhi’s intent to speed up trade talks and get a deal.Data over the last few years shows that energy purchases from the US have gone up, India’s Trade Secretary Rajesh Agrawal told reporters.
“Right now we are at an average of $12-$13 billion as per FY25 figures and there is headroom for $14-$15 billion” more with the current refinery configuration, he said.
The move could bridge the $42.7 billion trade surplus India enjoys and assuage President Donald Trump who has slapped the South Asian nation with a punitive 50% tariff, partly due to its purchase of Russian oil. Indian officials are in the US to meet counterparts and are hoping to secure a deal as early as next month, Bloomberg News reported Monday.
New Delhi’s broad strategy includes reducing the trade surplus by buying more American goods, improving access to Indian markets and easing trade barriers. It is considering roughly $40 billion of big-ticket purchases such as defense and oil from the US to narrow the surplus.
Indian industries have been resilient, absorbing some cost due to the high tariffs and maintaining their supply chains, Agrawal said.
India’s trade deficit widened to the highest in more than a year in September to $32.15 billion, but exports rose 6.7% from a year ago despite the US imposing its steepest tariffs in Asia on Indian goods.
