Russia covertly turned to India to secure critical electronic supplies and sensitive goods, according to leaked documents cited by the Financial Times.
In October 2022, Russia’s industry and trade ministry made plans to spend around $1 billion worth of Indian rupees on trade channels that would operate outside Western scrutiny, the outlet said.
According to the FT, the project was disclosed in letters sent to a shadowy trade group with ties to Moscow’s secret services.
The organization — the Consortium for Foreign Economic Activity and International Interstate Cooperation in Industry — was asked to develop a plan on how to source critical electronic components in India.
Central to these efforts was Russia’s massive trove of Indian rupees. As Western sanctions bore down on Moscow for its war in Ukraine, Russia was left unable to repatriate rupee profits from its ballooning oil trade with India.
By the summer of last year, the Kremlin was amassing as much as $1 billion worth of rupees per month without a way to convert or spend the currency.
The Consortium’s plan offered some way out, FT said.
Under its scheme, rupees would be spent to secure dual-use components through a “closed payment system” between Russian and Indian firms, the outlet cited.
This would provide a steady inflow of electronic equipment originally bought in Western markets, the leaked letters said.
Further funds could be directed toward investments in Indian electronic factories, that would provide Russia with needed information infrastructure, FT said.
Though it’s unclear how much of this plan went into effect, customs data tracked by FT align with the operation’s goals.
For instance, the leaked correspondence outlined that rupees would be used on electronics and machinery purchases from India — since mid-2022, trade has soared steeply in these categories.
Separately, an Indian businessman with knowledge of the matter told the FT that Russia has since looked into creating facilities in India.
For the Kremlin, continued access to electronic components is imperative as Russia’s fighting in Ukraine drags on through its third year. Since 2022, sanctions have grown much tighter, gradually cutting off Russia’s access to key financial lifelines.
