Russia becomes India's fourth-largest trading partner, imports jump 5-fold

Amid the rising bilateral trade, India has been exploring a rupee trade settlement mechanism with Russia

Russia has become India's fourth-largest trading partner with imports from the country spiking five-fold to $32.9 billion during the April-December period, according to a report in The Times of India.

There are two main contributors to India's higher imports from Russia -- crude oil and fertilisers. After Russia-Ukraine war broke out, the West slapped sanctions on Moscow, limiting its trade opportunities.

India bargained a deal with Russia for crude petroleum, seeing this as an opportunity to push the export of petrol and diesel to countries such as the Netherlands and Brazil. Riding on the crude trade, Russia became India's 20th largest source of imports in the last financial year.

The TOI reported that if the current pace of increase persists, Russia's imports could hit $50 billion, just shy of the value of goods shipped from the US, which is the third-largest source of imports for India.

According to a Reuters report, Russia had become the biggest fertiliser supplier to India in the first half of the FY23 for the first time by offering discounts over prevailing global prices.

India's fertiliser imports from Russia surged 371 per cent to a record 2.15 million tonnes in the first 6 months of the year that started on April 1, the agency reported, citing an unnamed senior government official.

Amid rising bilateral trade, India is trying to facilitate business in local currencies. India has been exploring a rupee trade settlement mechanism with Russia since the Russia-Ukraine war broke out in February last year. But the countries are yet to formalise the rules.

India is also looking to enhance exports of electronic items to Russia, officials in New Delhi say.