NEW DELHI: The ongoing tussle between Ukraine and Russia can disrupt India’s trade with European Union, Russia and other CIS (Commonwealth Independent States) counties. India’s total trade with these regions/countries is around USD 90 billion per annum. Experts believe the main problem will arise once the western countries put wider sanctions on Moscow as these sanctions can disrupt shipment movements and supply of fuels.
“Indian exporters are not overtly reliant on Russia per se (~1% of total exports), so western sanctions on Russia are not expected to destroy any direct demand. Similarly, Russia accounts for about 1% of our import bill. It ranks quite low among nations that supply oil to India. However, the derived risks can become pronounced with heightened crude and metal prices and India’s low inventories. A 3-month long conflict and corresponding high crude prices could inflate our trade deficit by an addition 200 bps at the very least,” said Debopam Chaudhuri, Head, Research and Ratings-TruBoard Partners.
In terms of bilateral trade, India imported worth USD 6.9 billion and exports worth $2.5 billion in the first nine months of FY22 from Russia. It mainly imports fuels, mineral oils, pearls, precious or semi-precious stones, nuclear reactors, boilers, machinery and mechanical appliances. It exports items like pharmaceutical products, electrical machinery and equipment, organic chemicals and vehicles from Russia.
India’s trade with Ukraine is about USD 372 million in the April-December period. The top commodities exported by Ukraine to India were fats and oils of vegetable origin (73.3%), fertilizers (10.6%), nuclear reactors, boilers, machinery (5.2%). Main Indian commodities imported by Ukraine were pharmaceutical products (32.7%), electrical machinery (7.8%) etc.