The large shipments of oil and fertiliser have also meant that the trade deficit with Russia, pegged at just over $20 billion during the first half of the current financial year, is next only to China’s $44.6 billion.
In fact, among India’s top five trading partners, China and Russia are the only countries where exports have taken a beating during the first half of the year, when overall exports had grown by 17%.
The US and China have retained the top two spots (see graphic). Trade with the US rose 20% due to an increase in exports (15% to $41.5 billion) and imports (29% to $26 billion). In case of China, there has been a decrease in exports of copper, cotton and ores among the major commodities, resulting in India’s shipments to its neighbour falling 36.6% to $7.8 billion, while imports have shot up 23.6% to over $52.4 billion during this period.
Disaggregated data released by the commerce department showed that India’s exports to Russia fell 19% to $1.3 billion during the first half of the current financial year. In contrast, imports surged five times from $4.2 billion during April-September 2021 to $21.3 billion in the first half of FY23. During this period, the value of Russian oil shipped to the country soared 8.3 times to nearly $18 billion, while fertiliser saw an even higher jump (see graphic).
The government has let oil companies buy more crude from Russia, which emerged as the biggest source for Indian crude in October, despite pressure from the US and other countries to stop imports after the war in Ukraine started in February.
Foreign minister S Jaishankar and oil minister Hardeep Puri have maintained that India will keep giving top priority to securing its interests, even as FM Nirmala Sitharaman has said that purchase of Russian crude has helped manage inflation.
