The Russian invasion of Ukraine has created global fiscal disruption. US crude oil briefly hit a 13-year high of US$130 a barrel in March amid Western sanctions on Russian oil and gas, with prices of Russian gas also rising sharply.
The ensuing supply chain gap created a global shortage of staples, exacerbating food insecurity as global debt soared above US$300 trillion. Russia has turned towards Asia as the default market for its energy amid the crisis, but it has failed to find many takers in South Asia.
India, the most significant player in the region, was one of the first countries to buy discounted oil from Russia. It also refused to join the economic sanctions against Moscow and abstained during the UN resolution condemning Russian aggression. This went against the stance of its key partnerships in the Indo-Pacific region, earning it the ire of the United States.
There are many factors behind India adopting this policy. First, New Delhi wants to preserve and convey its strategic autonomy. It does not want to be branded part of a certain bloc against another nation, especially given its recent border confrontation with China.
Second, India enjoys a long-standing relationship with Russia and is heavily dependent on it for arms and oil. In the event of a future conflict with China, India would not want Moscow to align with Beijing. India relies on Russia for most of its weaponry, with at least 60 per cent of its conventional arsenal of Soviet or Russian origin.
Despite efforts to diversify its weapons acquisition, India cannot totally forgo Russian arms. India also recently received its first shipment of Russian goods along the International North South Transportation Corridor, which it intends to leverage as a check on Beijing’s Belt and Road Initiative in the region.
Indian state-owned enterprises have also invested heavily in Russian oil and gas assets. India cannot afford to turn off the Russian spigot as it imports more than 85 per cent of its crude oil requirements.
Imran Khan, the former Pakistani prime minister, was on an official visit to Russia when the latter invaded Ukraine. Khan was later removed from office and blamed a Western conspiracy for his ousting, citing his visit to Russia as a major reason.
Pakistan subsequently abstained from the UN General Assembly resolution condemning Russia, urging a negotiated settlement. This was aimed at averting the precedent of international acceptance of military intervention as a means of conflict resolution, given Pakistan’s own conflict with India over Kashmir.
The visit to Russia was billed as a “prelude to a greater relationship”. Pakistan declining an invitation to US President Joe Biden’s summit on democracy and Khan’s presence at the Beijing Winter Olympics and in Russia have been seen as evidence of Pakistan’s move towards an “axis of revisionists”.
With the US shifting its focus to the Indo-Pacific, Pakistan is keen to build relationships with regional players who have influence over the strategic architecture of South and Central Asia. Like China, Pakistan also needs Russia to work with central Asian states for inter-regional connectivity and trade projects.
Pakistan also provides Russia with access to the Arabian Sea, with the Russian head of intelligence making a visit in 2016 to Gwadar Port – the centrepiece of the China Pakistan Economic Corridor (CPEC). Russia has also expressed interest in becoming part of the CPEC.
Both countries’ interests also converge in Afghanistan as Russia hopes to keep militant Islam away from central Asia. Plans for constructing the Pakistan Stream pipeline with the help of Russia are also under way.
The objective was to divert the Middle Eastern energy supply to energy-hungry Pakistan from Europe, increasing the latter’s reliance on Russian gas. Khan’s successors in Pakistan have shown little interest in importing Russian energy, though, despite a debilitating economic crisis.
The US quest for a “free and open Indo-Pacific” has attracted Russian attention to the region. Sri Lanka is a natural ally. Russia has been a reliable partner both in peaceful and fraught times, extending critical support during Sri Lanka’s civil war. It has invested in the island’s industrial sector and is one of the largest importers of Ceylon tea.
Sri Lanka is also a key partner in China’s Belt and Road Initiative. Ensnared in the worst economic crisis in its history, Sri Lanka has already purchased 90,000 tonnes of Russian crude and is open to buying more. Given its financial quagmire, it has few other options.
Having also abstained from the UN resolution against Russia, Bangladesh finds itself in a delicate balancing act. It relies on the US and European markets for its export industries, the cornerstone of its economic boom, while it is also part of the Belt and Road Initiative. It has expressed an interest in joining the “Indo-Pacific relationship” as well.
Bangladesh has traditionally enjoyed strong relations with Moscow. Russia is an important source of development funding for the country, having invested heavily in its energy sector. Dhaka’s primary objective is to keep its economic and social transformation on track, so it can hardly be seen to be taking sides. It has so far refrained from buying Russian oil.
As Asia emerges Russia’s financial saviour, China has become a leading market for Russian crude oil with India close behind. In doing so, India aspires to strike a balance between its strategic partnership with the US and the imperatives of its relationship with Russia while securing a check on China.
Asma Khan Lone is an academic based in Kashmir and the author of the upcoming book, “The Great Gilgit Game”. A graduate of the University of Cambridge, Asma has also taught at O.P. Jindal Global University, India.
