India seeks energy partnerships with Rosneft and other Russian firms

India Seeks to Deepen Energy Ties with Russia

India is looking to bolster its energy relations with Russia, with potential collaborations involving Rosneft and other major Russian oil companies. This initiative is part of a broader strategy to enhance bilateral trade, India's Foreign Secretary Vinay Mohan Kwatra revealed on Tuesday. The announcement follows a meeting in Moscow between Indian Prime Minister Narendra Modi and Russian President Vladimir Putin.

Targeting $100 Billion in Trade by 2030

During their discussions, Modi and Putin set an ambitious goal to elevate bilateral trade to $100 billion by 2030, a significant increase from the current $65 billion. Kwatra highlighted that the leaders specifically focused on strengthening their partnership in the energy sector, exploring avenues for collaboration both through government channels and direct partnerships with entities like Rosneft.

India has become the largest purchaser of Russian seaborne oil, benefiting from discounts as Western countries reduce their purchases due to sanctions over Russia's invasion of Ukraine in February 2022. Presently, Russia is India's primary oil supplier, catering to the needs of the world's third-largest oil importer and consumer.

Expanding Areas of Cooperation

Following the leaders' meeting, a joint statement enumerated nine key areas of cooperation to achieve the $100-billion trade objective. A vital part of India's strategy involves increasing its exports to Russia to address the trade imbalance currently favoring Moscow. Both nations are working towards eliminating non-tariff trade barriers and are committed to pursuing a Free Trade Agreement between India and the Russia-led Eurasian Economic Union.

The joint statement also emphasized expanded cooperation in various energy fields, including nuclear energy, oil refining, petrochemicals, energy infrastructure, technologies, and equipment. Significantly, Russian entities such as Rosneft hold a majority stake in Nayara Energy, a private Indian refiner, while Indian firms are invested in Russian oil exploration and production projects in the Far East.

Collaborations in Energy and Beyond

ONGC Videsh, an Indian company, is awaiting formal approval from Russian authorities to maintain its 20% stake in the Sakhalin 1 oil project. Besides energy, Kwatra noted India's significant imports of Russian fertilizers and expressed intentions to strengthen these ties for ensuring crop nutrient security.

Modi and Putin also agreed to establish a bilateral settlement system using national currencies, as stated in the joint communiqué. This development signifies a deepening of economic bonds between the two nations, reflecting a shared resolve to enhance strategic cooperation across multiple sectors.