Indian companies can therefore export military equipment to Russia, but also goods designed for civilian use that could be diverted for military purposes. According to information provided by ImportGenius, a US-based customs data aggregator, Brahmos Aerospace flew electrical components to Mashinostroyenia last year. Based in Moscow, Mashinostroyenia designs and manufactures missiles. The two companies know each other well. Brahmos Aerospace, headquartered in New Delhi, is a joint venture founded in 1998 by India’s Defense Research Department (DRDO) and Mashinostroyenia to develop and produce a cruise missile. The shipment left Hyderabad and arrived at Sheremetyevo Airport near Moscow on December 23, 2023. The value of the goods: $79,000. Mashinostroyenia has been under US sanctions since 2014.
This was not the first sale of this type. The Japanese business daily Nikkei revealed last year that Russian missile maker NPK KBM had purchased components for surface-to-air missile night vision systems from the Indian Ministry of Defense for $150,000 in August and November 2022.
Circumventing sanctions
And at the beginning of September, the Financial Times reported that Indian company Innovio Ventures had supplied $4.9 million worth of electronic equipment, including drones, to Russia in 2022. The sale was part of a plan drawn up by the Russian Ministry of Industry and Trade in October 2022 to procure more than $1 billion worth of dual-use electronics from India in order to circumvent sanctions, the British media reported.
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The plan appears to have paid off, according to the Indian Ministry of Commerce’s export registry. The country sold Russia parts that could be used for radar systems, antennas and jamming equipment worth around 320 million rupees (3-4 million euros) between April 2022 and June 2024. The Ministry of Commerce also lists radio communication parts and systems, as well as shipments categorized as “bombs and grenades” worth 852 million rupees (9 million euros).
The increase in exports is particularly significant in the aeronautics sector. From April 2022 to June 2024, around 5.7 billion rupees of spare parts for aircraft, helicopters or drones were sold to the Russians (65 million euros). And Moscow bought 6 million euros of small aircraft weighing 2 to 15 tonnes in the 2023-2024 financial year, which runs from April to March, whereas it hardly bought any from India before. Finally, 46 million rupees of parts for aeronautical or space navigation tools were exported in 27 months (around 500,000 euros).
Payments in rupees
India has become an integral part of Russia’s mechanism to circumvent Western sanctions. New Delhi and Moscow Russia have set up payment mechanisms to facilitate this trade without resorting to dollars or euros. The Indian Reserve Bank allows Russian banks to open rupee accounts that allow them to pay for goods in the Indian currency. The Indian Business Daily Mint had revealed in October 2023 that Russian companies had accumulated the equivalent of $8 billion in these accounts. A phenomenon that can be explained, in large part, by Indian purchases of Russian oil. New Delhi imported $77 billion worth of it in the 2022-23 and 2023-24 financial years, according to the CMIE, a statistics institute in Bombay, imports that it was able to pay for in rupees in particular.
Despite this, Prime Minister Modi has been repeating since the beginning of the invasion of Ukraine that “India is on the side of peace”. He and his government have repeatedly told Vladimir Putin that “This is not the time for war.”
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