Phillips P. OBrien
Its been a few weeks now since Donald Trump embarked on his trade war with India—which has been given a movable feast of justifications, but which seems to have been originally motivated by the desire to punish the Indian government for not supporting the narrative that Trump settled the recent dispute between Pakistan and India.
The different arguments given for the US move, depending on when and who was speaking, range from a desire to punish India for buying Russian oil, to trying to pry open the Indian market for US agricultural goods, to trying to generally rebalance the trading relationship between the two states.
One thing is clear, though, and that is that the policy has had the definite impact of driving India away from the USA and closer to Russia and China. It has already strengthened the Russian war effort in a very short period of time, and provided the Russian war economy with fresh capital at a time when things are looking uncertain.
In August, instead of cutting back on their purchases of Russian oil, the Indians jumped in and seemed to buy all that they could. They almost matched the Chinese for crude oil purchases that month, buying €2.7 billions worth when compared to the Chinese total of €2.9 billion. This was a real benefit to the Russian economy as the Chinese purchase represented a real drop from the €4.1 billion of Russian crude they bought in July.
And this was only part of Indian purchases of Russian energy. Overall, India’s fossil fuel imports from Russia reached €3.6 billion in August, including €510 million in coal and €282 million in refined products.
And the Indians in buying so much crude are helping the Russians cope with the effects of the Ukrainian attacks on Russian refineries. With Russian refining capacity being reduced, the Russians could be faced with a massive crude storage problem soon. However the Indians are stepping in and providing the Russians a market to ship their unrefined oil—which the Indians then refine themselves.
No comments:
Post a Comment