- Russia's share of India's oil imports has increased this year to 12% from 2% since the start of the war.
- Nirmala Sitharaman, India's Financial Minister, said that was part of the nation's effort to control rising inflation.
India has hiked up its share of Russian oil imports since the invasion of Ukraine as part of the country's plan to curb inflation, Nirmala Sitharaman, India's Financial Minister said on Thursday.
India has been one of Russia's largest fuel consumers since the start of the war, snapping up Russian crude at hefty discounts while the West shuns supplies from the country.
Russian oil shipments to the nation fell for the first time since the war in July as Indian suppliers began ramping up purchases of cheaper Saudi crude. But Russia's overall share of the India's oil consumption remains high, and has increased five-fold to 12% from 2% in February this year, Sitharaman said on Thursday.
It's all part of India's battle against rising inflation, while Western nations are left to tackle soaring energy prices, she added.
"In a situation where global prices were going beyond anyone's affordability, at that stage to take a very strong political decision, I respect the Prime Minister for his courage on this to get [crude oil] from Russia because they are ready to give it to you at a discount," Sitharaman said, according to Indian news outlets.
India's consumer inflation fell to 6.7% in July, Reuters reported, though Deutsche Bank analysts estimate the inflation rate rose to 6.9% in August – still above India's target rate of 2% to 6% inflation. Discounted imports of Russian crude would likely keep India's inflation reading lower, mitigating the effects of the global energy crisis on fuel prices.
Western nations have sought India's support in the G7 plan for a price cap on Russian crude, but Indian officials have said it would need to see more support from other Russian allies before backing the proposal, which intends to enforce a $40-$60 ceiling on Russian oil.
That's led Russia to offer an even more attractive 30% discount to some of its Asian buyers, and threaten to sell even more crude to Asia if the G7 goes ahead with the price cap.