Source: This post is created based on the article “Leaky Oil Borrell” published in Times of India on 18th May 2023.
Syllabus Topic: GS Paper 2 – Effect of policies and politics of developed and developing countries on India’s interests
News: Josep Borrell, the EU foreign affairs representative, criticized India for supposedly violating sanctions on Russia. However, the EU’s executive vice-president called for a more diplomatic approach, suggesting the EU and India should talk about the issue as friends.
This criticism was based on the report by Finnish research agency, Crea. It reported that India was bypassing sanctions on Russia. This was due to the EU buying Indian diesel and petrol made from Russian oil.
What is the background of these allegation?
As part of their sanctions on Russia, G7 nations had set the oil price limit at $60 per barrel last year. India then started buying more Russian oil, such that by March 2023, Russian oil made up 35% of India’s oil imports, up from just 1% before February 2022.
The EU has profited from this as it is India’s third largest trading partner. Much of their trade includes oil products, with India now exporting nearly 3.8 million tonnes of oil products to the EU, the G7, and others.
India has been supplying a lot of oil products to Europe, and this supply has tripled since Russia invaded Ukraine.
Crea reported that the EU was simply buying the same oil products from India that they used to buy directly from Russia. Therefore, it proposed a “place of origin” certification for products sold to the EU.
What is India’s stand on this criticism?
The foreign minister argued that once Russian crude oil is substantially processed in another country, it’s no longer considered Russian.
India is within its rights to import crude oil and export the processed products, regardless of the oil’s original source.