According to exporters, the Russia-Ukraine military conflict may have an impact on the country’s trade in that region by affecting the movement of consignments, payments, and oil prices. According to the Federation of Indian Export Organizations (FIEO), exporters have been asked to hold their consignments to the region or goods that travel via the Black Sea route.
Goods travel from the Suez Canal and the Black Sea to Russia, Ukraine, and other eastern European countries, according to FIEO Director-General Ajay Sahai. He also stated that the magnitude of the impact on trade will be determined by the length of the war. “This is a significant setback for trade, which was just recovering from the COVID-19 pandemic.”
Exporters are wary of conducting business in that region. “The war will have an impact on the movement of goods, payments, and oil prices,” Sahai predicted.
Fuels, mineral oils, pearls, precious or semi-precious stones, nuclear reactors, boilers, machinery, and mechanical appliances; electrical machinery and equipment; and fertilisers are among India’s main imports from Russia. While pharmaceuticals, electrical machinery and equipment, organic chemicals, and vehicles are major exports from India to Russia.
India’s bilateral trade with Ukraine has totalled USD 2.3 billion so far, this fiscal year, down from USD 2.5 billion the previous year. Agriculture products, metallurgical products, plastics, polymers, and so on are major Indian imports from Ukraine, while pharmaceuticals, machinery, chemicals, and food products, among other things, are major Indian exports to Ukraine.
The situation in Ukraine worsened after Russian President Vladimir Putin announced a military operation in Ukraine, raising serious concerns about the possibility of a full-fledged military conflict between the two countries.
Following Putin’s announcement, Ukrainian President Volodymyr Zelensky warned that an “invasion” could spark a “big war” in Europe. On Thursday, stock markets were in the red, and the Indian rupee fell against the dollar because of Russia’s attack on Ukraine, prompting investors to seek refuge in safe-haven assets.
Bilateral trade between India and Russia has reached USD 9.4 billion so far, this fiscal year, compared to USD 8.1 billion in 2020-21.