ISW analyses increase in exports of sanctioned goods from India to Russia

Analysts at the Institute for the Study of War (ISW) suggest that the increase in India's exports of sanctioned goods to Russia has been made possible thanks to Moscow's reserves of rupees accumulated from its oil sales to India.

Source: ISW

Quote from ISW: "Indian enterprises are reportedly increasing exports of dual-use technologies to Russia, in part thanks to large Russian reserves of rupees from oil sales to India."

Details: Bloomberg reported that US and European officials said India has become Russia's second-largest supplier of restricted technologies, such as microchips, circuits, and machine tools, following China.

India's monthly exports of restricted technologies to Russia reportedly doubled to US$60 million in April and May 2024 compared to the same months in 2023 and surged to US$95 million by July 2024.

Bloomberg indicated, citing official sources, that nearly 20% of the "sensitive" technology used by Russia's defence industry is being supplied via India.

Analysts noted that Russia's substantial reserves of Indian rupees, accumulated from oil sales to India, have played a key role in boosting Russian imports from India.

ISW recalls that the Financial Times reported in September 2024 on leaked documents revealing that Russia was covertly acquiring sensitive dual-use electronics from India, utilising "significant reserves" of Indian rupees amassed by Russian banks as a result of heightened oil sales to India.

Quote from ISW: "It is unclear to what extent private Indian businesses or state enterprises are exporting these technologies to Russia, but Indian firms appear to nonetheless be helping Russia sustain its war effort in Ukraine."

Details: ISW added that these early reports emerged against the backdrop of Indian Prime Minister Narendra Modi's visit to Ukraine in August 2024, during which he rhetorically emphasised the principles of international law, including sovereignty and territorial integrity, in conversations with Ukrainian President Volodymyr Zelenskyy.

Reports regarding the transfer of Indian artillery shells to Ukraine via European intermediaries have also heightened tensions in Russo-Indian relations.

To quote the ISW’s Key Takeaways on 12 October:

• Russian forces are reportedly relying on illicitly obtained Starlink terminals to improve combat coordination and the effectiveness of their tactical reconnaissance strike complex (TRSC) in Ukraine as part of an overarching effort to reach technological parity with Ukrainian forces.
• A Russian milblogger claimed that a Ukrainian F-16 downed a Russian Su-34 fighter aircraft in an unspecified area of the theatre on 12 October, but ISW cannot verify the claim that a Ukrainian F-16 was involved in the reported loss of the Russian Su-34.
• Unknown actors opened fire on personnel of the Russian Ministry of Internal Affairs' (MVD) Centre for Combating Extremism in Nazran, Republic of Ingushetia on the night of 11 October.
• Indian enterprises are reportedly increasing exports of dual-use technologies to Russia, in part thanks to large Russian reserves of rupees from oil sales to India.
• Russian forces recently advanced near Kupiansk, the city of Donetsk, and Robotyne.
• Russian forces are reportedly struggling to conduct effective counterbattery fires.

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