The government of India this weekend followed up on its feisty refusal to apologize for buying huge amounts of Russian oil by refusing to apologize for buying huge amounts of Russian coal.
The situation is much the same as it was with Russian oil: India needs the fuel, and Russia is offering steep discounts due to international sanctions, so they struck some deals.
Indian Foreign Minister S. Jaishankar scolded Europeans for hypocrisy this month because they accused India of “funding the war” in Ukraine by purchasing Russian oil, even as Europe continued buying Russian energy products.
Reuters on Saturday noted the Biden administration told India it did not want to see a “rapid acceleration” of energy imports from Russia, but that is exactly what they got, as Indian purchases of Russian coal spiked last month alongside India’s orders for Russian oil:
[India’s] purchases of coal and related products jumped more than six-fold in the 20 days through Wednesday from the same period a year earlier to $331.17 million, according to unpublished Indian government data reviewed by Reuters.
Indian refiners similarly have snapped up cheap Russian oil shunned by Western countries. The value of India’s oil trade with Russia in the 20 days through Wednesday jumped more than 31-fold to $2.22 billion, the data showed.
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“The Russian traders have been liberal with payment routes and are accepting payments in Indian rupee and United Arab Emirates dirham,” one source said. “The discounts are attractive, and this trend of higher Russian coal purchases will continue.”
Those discounts range as high as 30 percent, so India has more than tripled the amount it was spending on Russian coal when the Ukraine invasion began.
The European Union is banning new contracts for coal and planning to terminate existing agreements in August. India, which is one of the world’s largest coal producers but began importing coal this year to address power shortages, saw an opportunity to take advantage of Russia’s fire-sale pricing and replenish its depleted coal stocks.
India’s two preferred coal exporters, Australia and Indonesia, were unable to meet its needs due to weather problems and export caps, respectively. Industry analysts expect India’s orders for Russian coal to spike again in August, when the EU termination of existing contracts goes into effect.
Indian trade and government sources said on Monday that Tata Steel, the nation’s top steelmaker, imported 75,000 tonnes of Russian coal in the second half of May – after saying in April that the company was making “a conscious decision to stop doing business with Russia.”
A Tata spokesman insisted the company would not make any further deals with Russian suppliers and merely took delivery on coal purchased before April. Other Indian steelmakers reportedly have no intention of halting their Russian coal imports.
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