The article is about the EU on Russian oil based Indian products into the European Union through Indian refined products. The article discusses the increase in India’s purchase of Russian oil since the Ukraine invasion.
What is the context?
- Josep Borrell, the EU’s top foreign affairs official, pointed out that EU entities purchasing refined products from India bear primary responsibility for the leakage of Russian oil-based products into the European Union. He published these remarks on his blog titled “Some Clarifications on the Circumvention of EU Sanctions Against Russia.”
Increase in Indian purchases of Russian oil since Ukraine invasion
Borrell noted a significant increase in India’s purchase of Russian oil since Russia’s invasion of Ukraine. He highlighted that before the invasion, Russian oil accounted for only 0.2% of India’s total oil imports. However, last month, that share had risen to 36.4%.
EU’s stance on trade with Russia
The EU aims to avoid financing Russia’s war against Ukraine by refraining from purchasing Russian energy exports and selling technological products and components needed for Russia’s war efforts. Borrell clarified that the EU’s trade rules with Russia only apply to EU entities and cannot be forced on other nations due to the lack of extraterritorial sanctions.
China’s increased imports of Russian oil
Borrell mentioned that China has been importing even higher volumes of Russian oil since the implementation of an oil price cap by the G-7 economies in December 2023.
Dilemma of Indian refined petroleum products entering the EU market
Borrell acknowledged the dilemma created by Indian refined petroleum products, made from Russian oil, entering the European market. He highlighted that the export of these products, such as jet fuel and diesel, from India to the EU had significantly increased from 1.1 million barrels in January 2022 to 7.4 million barrels in April 2023.
Legality and morality of EU companies buying refinery products made from Russian oil
Borrell raised the moral issue of European companies buying refinery products made from Russian oil and selling them in Europe. While this practice is considered legal, it is deemed immoral by some, including an economic adviser to Ukrainian President Zelensky.
Focus on EU economic operators and solutions
Borrell emphasized the need for the EU to address its own economic operators and find solutions to circumvent sanctions. He stated that if Indian refiners are selling refined products, it is because European companies are buying them.
The leakage of Russian oil-based products into the EU remains a concern, with EU entities involved in buying refined products from India being held accountable.
India’s stand
- India has said that its exports of refined petroleum products to Europe comply with the European sanctions regime. This is in response to concerns raised by the European Union about India’s purchase of Russian crude oil and the resale of refined products to Europe.
- India’s external affairs minister, S. Jaishankar, has said that India is not violating any sanctions by buying Russian crude oil at a discounted price. He has also said that India is not trying to circumvent the sanctions by reselling refined products to Europe.
- The European Union has said that it is looking into the matter and that it will take appropriate action if it finds that India is violating the sanctions.
- It is unclear what the outcome of this dispute will be. However, it is clear that India is not willing to give up its relationship with Russia, even if it means upsetting its European allies.
Some points to be remembered:
-
India’s Import of Russian Oil:
India has imported around 3 million barrels of Russian oil since the start of the war in Ukraine.
-
EU Sanctions on Russia:
The European Union has imposed sanctions on Russia, including a ban on imports of Russian oil.
-
Import of Russian Oil through Refined Products:
- Refined products are not subject to the ban, allowing for the import of Russian oil into the EU through third countries like India.
- The quantity of Russian oil imported through refined products into the EU remains unclear.
-
India’s Compliance with Sanctions:
- India has stated that it is not trying to circumvent the sanctions by reselling refined products to Europe.
-
EU Investigation and Potential Action:
- The European Union has stated that it is looking into the matter and will take appropriate action if it finds that India is violating the sanctions.
Conclusion
The issue of Russian oil-based products leaking into the European Union (EU) through Indian refined products has raised concerns and led to discussions on accountability and trade practices. The EU’s top foreign affairs official, Josep Borrell, highlighted the significant increase in India’s purchase of Russian oil since the Ukraine invasion, emphasizing the dilemma created by Indian refined petroleum products entering the EU market. Questions have also arisen regarding the legality and morality of European companies purchasing refinery products made from Russian oil.
Way Ahead
To address this issue, it is essential for the EU to focus on its own economic operators and find effective solutions to prevent the circumvention of sanctions. Collaboration and dialogue between nations, including India, are crucial for resolving these complex challenges. The EU should consider reviewing and strengthening its trade rules with Russia while respecting the sovereignty of other nations. It is important to strike a balance between legal trade practices and moral considerations in dealing with Russian oil-based products.
- In the Indian context, transparency and compliance with European sanctions are crucial.
- India’s external affairs minister asserts that India is not violating sanctions or circumventing them.
- Clear communication and cooperation between India and the EU are essential for resolving concerns.
- A comprehensive and collaborative approach is necessary to address the leakage of Russian oil-based products.
- Responsible trade practices and diplomatic relationships should be maintained between India, the EU, and other nations involved.
For more Current affairs based articles, please visit here https://dronacharyaias.in/daily-current-affairs/