Current Affairs 3rd April

India-Australia deal seeks to double bilateral trade in 5 years #GS2 #IR

India and Australia signed an Economic Co-operation and Trade Agreement (ECTA) on Saturday in the presence of Prime Minister Narendra Modi and his counterpart in Canberra Scott Morrison, with an eye on doubling bilateral trade to $50 billion in five years and ease movement of people, goods and services across borders.

The agreement with Australia, which Commerce and Industry Minister Piyush Goyal expects would create 10 lakh additional jobs in the country over the next five years, was described as a ‘watershed moment in bilateral ties’ by Mr. Modi.

“On the basis of this agreement, together, we will be able to increase the resilience of supply chains, and also contribute to the stability of the Indo-Pacific region,” he said about the deal that will facilitate work visas for two to four years for Indian students in Australia on a ‘reciprocal basis’ and allow Indian chefs and yoga professionals to work Down Under.

The trade and economic partnership deal with Australia, which is in the midst of a protracted trade battle with China, is a significant milestone at a time when the developed world is looking to hedge its supply chain dependence.

A government statement noted that this is also the first such pact signed by India with a developed country in a decade. Mr. Morrison said the deal “opens a big door into the world’s fastest growing major economy for Australian farmers, manufacturers, producers and so many more”.

Indian exports to Australia have been growing at a rapid clip and the agreement, which may be expanded further after its implementation in the current form, will facilitate zero duty access “on over 96% of Indian exports, including several labour-intensive industries,” Mr. Goyal said.

India will, in turn, offer preferential access to Australia on over 70% of its tariff lines on goods imports, including ‘lines of export interest to Australia which are primarily raw materials and intermediaries such as coal, mineral ores and wines, etc.’, the Commerce Ministry said.

In a joint statement with Mr. Morrison, Australia’s Trade, Tourism and Industry Minister Dan Trehan said: “Tariffs will be eliminated on more than 85% of Australian goods exports to India (valued at more than $12.6 billion a year), rising to almost 91% (valued at $13.4 billion) over 10 years.”

Concerns, safeguards

Talks with Australia for a possible trade and economic partnership pact had begun about a decade ago, but were aborted after a previous regime in Canberra asked India to join the Regional Comprehensive Economic Partnership instead.

After India refused to join the RCEP, negotiations were stalled. Fresh parleys between the two sides began last September after Mr. Trehan visited India.

Mr. Morrison said the deal “opens a big door into the world’s fastest growing major economy for Australian farmers, manufacturers, producers and so many more”.

Indian exports to Australia have been growing at a rapid clip and the agreement, which may be expanded further after its implementation in the current form, will facilitate zero duty access “on over 96% of Indian exports, including several labour-intensive industries,” Mr. Goyal said.

India will, in turn, offer preferential access to Australia on over 70% of its tariff lines on goods imports, including ‘lines of export interest to Australia which are primarily raw materials and intermediaries such as coal, mineral ores and wines, etc.’, the Commerce Ministry said.

In a joint statement with Mr. Morrison, Australia’s Trade, Tourism and Industry Minister Dan Trehan said, “Tariffs will be eliminated on more than 85% of Australian goods exports to India (valued at more than $12.6 billion a year), rising to almost 91% (valued at $13.4 billion) over 10 years.”

Talks with Australia for a possible trade and economic partnership pact had begun about a decade ago, but were aborted after a previous regime in Canberra asked India to join the Regional Comprehensive Economic Partnership instead.

After India refused to join the Regional Comprehensive Economic Partnership, negotiations were stalled. Fresh parleys between the two sides began last September after Mr. Trehan visited India.

Amending laws

Australia, which goes to polls this year, has agreed to amend its tax laws to resolve India’s long-standing complaint that its firms providing technical services in the country are taxed on their offshore income. Both trade ministers said the electoral cycle will not impact the trade pact.

With a rich repertoire of vineyards in Yarra Valley and beyond, Australia will now be able to export wine bottles of 750 ml, costing over $5 dollars, to India at a concessional import duty and the countries have agreed to set up a joint dialogue to work together on wine-related trade issues. A working group will also be set up to resolve issues related to bilateral trade in whisky and other alcoholic beverages.

The Commerce Ministry said the agreement provides adequate safeguards to prevent circumvention and protect against a sudden surge in import of goods. It also said this is the first trade deal which includes a compulsory review mechanism after 15 years.

This is the second economic partnership pact signed within a week, following a similar deal with the UAE last week. Mr. Goyal said more such deals are in the offing.

“We are in very active dialogue with the U.K., Canada, and have agreed to work on an interim agreement with both that can be done faster, followed by a comprehensive arrangement,” 

https://www.thehindu.com/todays-paper/india-australia-deal-seeks-to-double-bilateral-trade-in-5-years/article65285955.ece

WHO records new SARS-CoV-2 variant #GS3 #SnT

The World Health Organization (WHO) has flagged the emergence of a new variant of the SARS-CoV-2 virus, the XE recombinant, in the United Kingdom, and with a possibly higher rate of transmission.

The WHO, in its weekly epidemiological update, said the recombinant was detected in the United Kingdom on January 19 and over 600 sequences have been reported and confirmed since. It went on to add: “Early-day estimates indicate a community growth rate advantage of about 10% as compared to BA.2, however this finding requires further confirmation.”

The U.K. Health Security Agency (UKHSA), which tracks SARS-CoV-2 variants, analysed three recombinants, known as XF, XE and XD. It explained that, of these, XD and XF are recombinants of Delta and Omicron BA.1, while XE is a recombinant of Omicron BA.1 and BA.2. A recombinant variant occurs when an individual becomes infected with two or more variants at the same time, leading to a mixing of genetic material in the human body. Several such recombinants have emerged in the past during the pandemic.

The UKHSA has stated that in the U.K., only 38 cases of XF have been identified, though none since mid-February. There is currently no evidence of community transmission within the U.K. XD has not been identified in the U.K. to date, though 49 cases have been reported to global databases.

However, a total 637 cases of XE have been confirmed in the UK so far. “The earliest of these has a specimen date of 19 January 2022. There is currently insufficient evidence to draw conclusions about growth advantage or other properties of this variant,” the agency said. However, all the recombinants are being tracked closely, it added.

Reflecting this, the WHO also said that until there emerges further confirmation on the community growth rate, “XE continues to belong to the Omicron variant until significant differences in transmission and disease characteristics, including severity, may be reported.” It has also committed to closely monitoring and assessing the public health risk associated with the recombinant variants.

https://www.thehindu.com/todays-paper/who-records-new-sars-cov-2-variant/article65285953.ece

Prehistoric relics point to riverine settlement at Attappady  #GS1 #Culture

The discovery of several prehistoric artefacts and archaeological remains along the banks of three rivers flowing through the Attappady hills straddling Kerala and Tamil Nadu, indicating the presence of a mature settlement, has surprised researchers and local people alike.

The discovery of several stone tools, inhabited caves, menhirs, cists or burial chambers, stone circles, burial urns, black and red ware pottery, terracotta images, stone carvings, and granite inscriptions points to prehistoric human settlements in the predominantly tribal area of Attappady.

The archaeological discoveries were made from different places along the banks of the rivers Bhavani, Siruvani, and Kodumkara Pallam or Anakkatti recently. The remains came to light during an extensive post-doctoral study undertaken by economist A.D. Manikandan among the tribal communities of Attappady.

However, over the years, many of the prehistoric artefacts have been destroyed and damaged by the local people, unaware of the region’s ancient past. Although there were dozens of granite menhirs, some up to 20 feet tall, only a few remain intact. Tellingly, one of the tribal settlements at Kottathara is called Nattakkallu Ooru (meaning a hamlet of menhirs), where all but one 11-ft menhir have been destroyed.

“No one bothered to go back into the history of Attappady. What amazes me is that this tribal land known only for its penury, sufferings, exploitation and land-grabbing has had a marvelous civilization to boast of. Interestingly, innumerable relics were found from both sides of the rivers flowing through Attappady,” said Dr. Manikandan, whose two-volume book on the pre-historic life and culture of Attappady is set to be published shortly.

This reporter found cist burial sites and shards of black and red pottery widely scattered on both sides of Kodumkara Pallam. The river marks the border between Kerala and Tamil Nadu with Attappady on the western bank.

Black and red polished earthen ware with different patterns were also discovered in recent weeks from private land at Anakkatti in Sholayur grama panchayat. “We were surprised by the findings. We want the Archaeology department to study it.

https://www.thehindu.com/news/national/kerala/prehistoric-relics-reveal-attappadys-ancient-past/article65282602.ece

Nepal PM seeks steps to resolve border dispute #GS2 #IR

India and Nepal on Saturday discussed the Kalapani border dispute, said Prime Minister Sher Bahadur Deuba in New Delhi on Saturday. The visiting Nepalese Prime Minister and Prime Minister Narendra Modi jointly inaugurated the first cross-border rail link between India and Nepal. Nepal also became the 105th member country to sign on to the Framework Agreement of International Solar Alliance (ISA).

“We discussed the boundary issue and I urged Modi ji to resolve it through the establishment of a bilateral mechanism,” said Mr. Deuba. The visit of the Nepalese leader is the first since the Kalapani boundary issue erupted in November 2019 after the revised political map of India depicted the triangular area of Kalapani-Lipulek-Limpiyadhura within the territory of Uttarakhand.

Kathmandu responded by placing a revised political map of the country in the national insignia of Nepal.

Joint decision

Both sides were expected to address the issue under an existing mechanism led by the Foreign Secretaries but that meeting is yet to be announced. Nepal had earlier written to New Delhi seeking the meeting of the Foreign Secretary-level mechanism to discuss the border dispute at Kalapani.

India also urged Nepal to avoid “politicisation“ of the boundary dispute. Foreign Secretary Harsh Vardhan Shringla, briefing the media after the talks, said, “There was a general understanding that both sides needed to address this in a responsible manner through discussion and dialogue. In the spirit of our close and friendly relations, politicisation of such issues should be avoided.”

India’s position on avoiding politicisation of the Kalapani issue appears to be aimed at the upcoming election season in the Himalayan country when emotive issues like the border dispute are expected to be raised during political campaigns by both the Opposition led by former PM K.P. Sharma Oli and some sections of the ruling coalition of Nepali Congress and CPN-Maoist Centre.

The two leaders inaugurated the broad gauge Jaynagar-Kurtha rail link that will establish rail connectivity to Janakpur in Nepal. India also launched the RuPay card facility in Nepal during the formal ceremony held at the Hyderabad House.

Power projects

The two sides came out with a Joint Vision Statement on Power Sector cooperation between India and Nepal recognising “unprecedented opportunities”. Prime Minister Modi and PM Deuba jointly inaugurated the 90-km-long 132 KVDC Solu Corridor Transmission line and substation that were built through the Line of Credit extended by India.

Both the leaders welcomed the February 28 Nepal-India agreement to enable long term supply of fertilizers from India to Nepal, a key demand of Kathmandu to deal with the fertilizer crisis in the country. For the past few years, Nepal’s agriculture sector has been suffering from a shortage of urea and chemical fertilizers. Under the G-2-G agreement, Kathmandu can import around 210,000 metric tonnes of chemical fertilizer from India annually.

https://www.thehindu.com/todays-paper/tp-national/nepal-pm-seeks-steps-to-resolve-border-dispute/article65285920.ece

Northeast part of ‘mainstream’: Rijiju #GS2 #Governance

Terming the Centre’s decision to lift the Armed Forces Special Powers Act (AFSPA) from large parts of Assam, Nagaland and Manipur “historic”, the Bharatiya Janata Party (BJP) on Saturday said peace had been restored in the northeastern region.

At a press conference here, Union Law Minister Kiren Rijiju, who is an MP from Arunachal Pradesh, said the region was now part of the national “mainstream”, all set to become the country’s most important economic hub. He attributed the achievement to the two-pronged approach of the Narendra Modi-led government: of development and dialogue with disgruntled groups in the region. Mr. Rijiju said after Mr. Modi became the Prime Minister, the previous “Look East” policy turned into “Act East” policy, owing to which the northeastern States were now in a transformative mode. The Prime Minister, during his tenure so far, had visited the region about 50 times, he said.

Stating that development and peace were interlinked, the Union Minister said the very fact that AFSPA had been removed in most parts of Assam, Nagaland and Manipur meant that peace had been restored there, barring some areas where the situation would improve. He said the Prime Minister’s vision of lifting the Act off the entire region would soon be accomplished.

The Minister said in 2015, the Act had been removed completely from Tripura, then from some districts of Assam and subsequently from Arunachal Pradesh, except for three districts. The latest decision was being welcomed by the people of the northeastern region, including civil society members and political leaders, he said.

Mr. Rijiju said under Union Home Minister Amit Shah’s leadership, the Ministry of Home Affairs implemented the Prime Minister’s vision effectively by actively engaging with the region’s political leaders. Several long-standing inter-State border disputes were being handled properly.

The first part of major differences between Meghalaya and Assam had been settled, while the rest would be resolved soon. The first phase of addressing the Assam-Arunachal Pradesh boundary issues was expected to begin by the end of the month. The Assam-Nagaland and the Mizoram-Assam border disputes were also being addressed, the Minister said.

Mr. Rijiju said in the past few years, peace accords had been signed with various insurgent groups. On the development front, Rs. 76,000 crore was allocated this year. Besides, the Centre’s flagship schemes were being implemented across the region. It was now up to the people of and the State governments to effectively make use of the resources.

https://www.thehindu.com/todays-paper/tp-national/northeast-part-of-mainstream-rijiju/article65285846.ece

Army inducts Russian MANPADS #GS2 #IR

The Army which has long been looking for new man-portable air defence systems (MANPADS), has inducted a small number of Igla-S systems recently procured from Russia under emergency procurement, according to defence sources. However, a much larger contract for Igla-S systems under the very short-range air-defence system (VSHORAD) deal is still pending and is under review by the Defence Ministry.

“The contract was signed in December 2020 and the equipment was delivered by December 2021. This includes 24 launchers, 216 missiles and testing equipment,” one of the sources said.

The procurement was done through the Vice-Chief’s emergency financial powers given to the Services for the first time after the Balakot airstrike in February 2019 and further extended after the stand-off with China in eastern Ladakh in May 2020. Under this, the Services can procure weapons systems up to Rs. 300 crore on an urgent basis without any further clearances.

Against the backdrop of the Russian special military operation in Ukraine and the Western sanctions, India and Russia are working out modalities to utilise the rupee-rouble route in a large way for trade and payments. The Ministry is also assessing the impact it would have on the timely execution of deals as well as steady supplies of spares and support.

Last defence

The Request for Proposal for VSHORAD was issued in October 2010 for over 5,000 missiles, 258 single launchers and 258 multi-launchers. Five contenders responded and eventually, three made it to the trials — MBDA of France, Rosoboronexport of Russia and SAAB of Sweden. All three companies were declared technically compliant in 2017 and Igla-S was declared the lowest bidder in November 2018.

While the benchmark price arrived at by the Army was just over $2 billion, Rosoboronexport’s bid was much lower at around $1.47 bn, SAAB at about $2.6 bn, and MBDA at about $3.68 bn. This led to much deliberation within the Ministry as the Russian bid was much lower than the benchmark price. The deal also saw several allegations of deviations in procedures with some of the vendors sending protest letters.

As per requirements, the VSHORAD should have a maximum range of 6 km, an altitude of 3 km along with all-weather capability and will replace the existing Igla in service which is in urgent need of replacement. VSHORADS are the soldier’s last line of defence against enemy combat aircraft and helicopters in the multilayered air defence network.

https://www.thehindu.com/todays-paper/tp-national/army-inducts-russian-manpads/article65285847.ece

Why is Sri Lanka under a state of Emergency? #GS2 #IR

The story so far: On Friday night, a day after angry citizens converged in front of President Gotabaya Rajapaksa’s Colombo residence, demanding he step down immediately, he declared a state of Emergency in Sri Lanka. An extraordinary gazette notification said the Emergency, coming into immediate effect, was “in the interests of public security, the protection of public order and the maintenance of supplies and services essential to the life of the community.” On Saturday, the government imposed an all-island curfew, restricting movement until Monday morning. Sri Lanka is in the midst of a sharp economic downturn that has led to severe food shortages and growing public resentment.

What triggered the crisis?
Sri Lanka’s economic crisis can be traced to two key developments in the immediate past — the Easter Sunday bombings of 2019 that deterred tourists, and the pandemic since early 2020 that stalled recovery and further drained the economy. As it grappled with an unprecedented challenge, the Rajapaksa regime made policy choices that are now proving to be costly. It cut the government’s tax revenue substantially and rushed into an ‘organic only’ agricultural policy that will likely slash this year’s harvest by half. The weak and debt-ridden economy with the lingering strain of the pandemic, and ill-advised policies accelerated the downward spiral.

What were the economic indicators?
COVID-19 hit Sri Lanka’s key foreign revenue earning sectors hard. Earnings from tourism, exports, and worker remittances fell sharply in the last two years. But the country could not stop importing essentials, and its dollar account began dwindling. Fast draining foreign reserves, a glaring trade deficit, and a related Balance of Payments problem came as crucial signals. Colombo’s huge foreign loan obligations and the drop in domestic production compounded the economic strain.

When did things begin to worsen?
The long-simmering crisis made its first big announcement during last August’s food emergency, when supplies were badly affected. It was soon followed by fears of a sovereign default in late 2021, which Sri Lanka averted. But without enough dollars to pay for the country’s high import bill, the island continued facing severe shortage of essentials — from fuel, cooking gas, and staple foodgrains to medicines.

How did the crisis manifest itself on the ground?
Consumers could not find the most basic things such as petrol, LPG cylinders, kerosene, or milk in the market. They spent hours waiting in long queues outside fuel stations or shops. Supermarket shelves were either empty or had products with high price tags that most could not afford. For instance, the price of one kg of milk powder, a staple item in dairy-deficient Sri Lanka, suddenly shot up to nearly LKR 2000 in March. Be it cooking gas, oils, rice, pulses, vegetables, fish, meat, consumers found themselves paying substantially more, or simply had to forego the item. The fuel shortage has led to long blackouts — up to 13 hours — across the island.

What is the situation now?
The value of the Sri Lankan rupee has dropped to 300 against a U.S. dollar (and even more than 400 in the black market), putting importers in a difficult spot. The government is unable to pay for its import shipments, forcing consignments to leave the Colombo port. For the average citizen contending with COVID-induced salary cuts and job losses, the soaring living costs have brought more agony.

Has the government sought help?
Yes, including from India which has extended $2.4 billion this year, and China, that is considering a fresh request from Colombo for $2.5 billion assistance, in addition to the $2.8 billion it has extended since the pandemic broke out. The government has decided to negotiate an International Monetary Fund programme, while seeking support from other multilateral and bilateral sources. But even with all this help, Sri Lanka can barely manage. Recovery will neither be fast nor easy, say experts.

https://www.thehindu.com/news/international/explained-why-is-sri-lanka-under-a-state-of-emergency/article65284410.ece

New criminal Bill #GS2 #Governance

The story so far: On March 28, Minister of State for Home Ajay Kumar Mishra introduced The Criminal Procedure (Identification) Bill, 2022 in Lok Sabha. If passed, it will allow police and prison authorities to collect, store and analyse physical and biological samples including retina and iris scans of convicted, arrested and detained persons. At the introduction stage, Opposition members opposed the Bill terming it “unconstitutional” and an attack on privacy.

What is the legislation about?

The Bill seeks to repeal The Identification of Prisoners Act, 1920. The over 100-year-old Act’s scope was limited to capturing of finger impression, foot-print impressions and photographs of convicted prisoners and certain category of arrested and non-convicted persons on the order of a Magistrate. The Statement of Objects and Reasons of the 2022 Bill said that new ‘‘measurement’’ techniques being used in advanced countries are giving credible and reliable results and are recognised the world over. It said that the 1920 Act does not provide for taking these body measurements as many of the techniques and technologies had not been developed then.

What are the major changes proposed?

It proposes four major changes. First, it would define ‘‘measurements’’ to include “signature, handwriting, iris and retina scan, physical, biological samples and their analysis, etc.” It does not specify what analysis means, implying that it may also include storing DNA samples. The “etc.” mentioned in the text of the Bill could give unfettered powers to law enforcement agencies to interpret the law as per their convenience, sometimes to the disadvantage of the accused.

Second, it empowers the National Crime Records Bureau of India (NCRB), under the Union Home Ministry, to collect, store and preserve the record of measurements for at least 75 years. The NCRB will be able to share the data with other law enforcement agencies as well. Police is a State subject and NCRB works under the Union government, and experts contend this provision may impinge on federalism.

Third, it empowers a Magistrate to direct any person to give vital details, which till now was reserved for convicts and those involved in heinous crimes. Fourth, it empowers police or prison officers up to the rank of a Head Constable to take details of any person who resists or refuses to do so.

What are some other changes?

The Bill also seeks to apply to persons detained under any preventive detention law. The Bill also authorises taking vital details of “other persons” for identification and investigation in criminal matters. It doesn’t define the “other persons”, implying its ambit extends beyond convicts, arrested persons, or detainees.

The Bill’s stated objective is it provides legal sanction for taking such details and will make the investigation of crime more efficient and expeditious, and help in increasing the conviction rate. Congress member Manish Tewari pointed out in the Lok Sabha that Article 20(3) of the Constitution states that “no person accused of any offence shall be compelled to be a witness against himself.” BSP member Ritesh Pandey opposed the Bill saying it proposes to collect samples even from those engaged in political protests.

Is there a precedent?

The Karnataka Assembly passed The Identification of Prisoners (Karnataka Amendment) Bill in 2021, to amend the 1920 Act for application in the State. The Bill expands the collection to include blood samples, DNA, voice and iris scans “for effective surveillance and prevention of breach of peace and crime.”

It empowers the Superintendent of Police or Deputy Commissioner of Police to order collection in addition to a magistrate to avoid delays and reduce the workload on the judiciary. As the provisions of the Bill were repugnant with the 1920 Act, a Central Government’s Act, Governor Thawar Chand Gehlot reserved the Bill for consideration of the President of the India.

Under the process, the Bill is examined by the Ministry of Home Affairs (MHA) and is sent for inter-ministerial consultation. The Bill is yet to be cleared by the MHA. Now, the government has introduced a fresh legislation to replace the 1920 Act that will be applicable across the country. The States have been empowered to notify rules under the Act to specify the manner in which details could be recorded, preserved, disseminated and destructed and “any other matter which is to be prescribed, or in respect of which provision is to be made.”

Tamil Nadu introduced and notified The Identification of Prisoners (Tamil Nadu Amendments) Act in 2010. The Act allows the police to draw “blood samples” other than the specified measurements from the limited categories of suspects and convicts defined in the 1920 Act. Though President’s assent is awaited for the Karnataka Bill, the Tamil Nadu Act has been in practice for more than a decade after it received the assent of the Governor.

The Statement of Objects and Reasons of the 2022 Bill says the new ‘measurement’ techniques being used in advanced countries are giving credible and reliable results and are recognised the world over

https://www.thehindu.com/todays-paper/tp-miscellaneous/tp-others/new-criminal-bill/article65285827.ece

Roubles for fuel, defence deals with Russia #GS2 #IR

The story so far: The last two weeks saw a flurry of visits by senior officials from the West to convince India not to undermine sanctions on Russia by opting for payments in national currencies as also not to increase purchase of discounted oil from Russia. On Friday, Russian Foreign Minister Sergey Lavrov was in New Delhi, the first high-level visit since the start of the Russian offensive in Ukraine.

What is the status of oil purchases from Russia?

“We have started buying Russian oil and have bought at least three to four days of supply,” Finance Minister Nirmala Sitharaman said on Friday. Mr. Lavrov reiterated that Russia is moving ahead with the use of national currencies in lieu of dollar payments with both India and China and these efforts would be “intensified”.

“I have no doubt that a way would be found to bypass the artificial impediments which illegal unilateral sanctions by the West create. This relates also to the area of military and technical cooperation. We have no doubt that the solution would be found and respective ministries are working,” Mr. Lavrov said, addressing a press conference after bilateral talks with his Indian counterpart S. Jaishankar.

The developments came a day after the U.S. Deputy National Security Adviser for International Economics Daleep Singh warned of “consequences” to countries that actively attempt to circumvent or backfill the sanctions.

In sharp comments on Thursday during a conversation with visiting U.K. Foreign Secretary Liz Truss, Mr. Jaishankar termed it a “campaign” against India for buying Russian oil at discounted prices while European countries remain the biggest buyers of oil and gas from Russia despite their announcements to scale it down.

India and Russia have been working on streamlining payments through the rupee-rouble mechanism circumventing the SWIFT system and the dollar route. Towards this, earlier in the week, a team from Russia’s central bank met officials from the Reserve Bank of India to iron out issues and identify banks that have no exposure to the Western sanctions through which payments can be made. Mr. Jaishankar informed Parliament recently that a special inter-ministerial group led by the Finance Ministry has been tasked with resolving payment issues for trade with Russia.

According to Reuters , India bought at least 13 million barrels of Russian oil since the Ukraine war began on February 24, a steep rise from last year, when India bought 16 million barrels of Russian oil in all of 2021.

What about defence deals?

The Defence Ministry and the Services have carried out assessments and are closely monitoring the impact the sanctions can have on timely deliveries and supplies from Russia as several major deals are also underway. Officials have stated that while some shipping delays were possible, there would not be any dent in the Army’s operational preparedness along the borders especially the Line of Actual Control.

In addition, the armed forces have also made significant emergency procurements in the last two years since the standoff in eastern Ladakh and have stocked up on spares and ammunition. So, there shouldn’t be any immediate urgency for spares and other requirements, officials noted.

For the two countries, payment by a rupee-rouble arrangement is not new. For instance, for the $5.43 billion deal for S-400 air defence systems signed in October 2018, with the looming threat of U.S. sanctions under CAATSA (Countering America’s Adversaries Through Sanctions Act), the two sides had worked out payments through the rupee-rouble exchange.

In fact, the delivery schedule got slightly delayed as the payment details were being worked out. Last December, India began taking deliveries and the first unit has been deployed on the western border. The second unit is scheduled to arrive shortly, officials stated.

In addition, several new deals are in the pipeline including 12 Su-30MKI aircraft and 21 MiG-29 fighter jets for the Indian Air Force. However, the Defence Ministry is carrying out a review of all direct import deals and some of them including those from Russia are expected to be dropped as part of the push towards domestic manufacturing.

According to a recent report from Stockholm International Peace Research Institute (SIPRI), India’s defence imports reduced by 21% between 2012-16 and 2017-21 and while Russia continues to remain the largest arms supplier, the percentage has dropped. “Russia was the largest supplier of major arms to India in both 2012-16 and 2017-21, but India’s imports of Russian arms dropped by 47% between the two periods as several large programmes for Russian arms wound down.

https://www.thehindu.com/todays-paper/tp-miscellaneous/tp-others/roubles-for-fuel-defence-deals-with-russia/article65285829.ece