Page 38 - The Indian EYE 032522

BuSINESS EYE MARCH 25, 2022 | The Indian Eye 38

Wheat, maize, oil and pharma:

how the war in ukraine may open

doors for Indian firms

Russia offers crude oil and other commodities at discounted rates to India after the US

and its allies impose sanctions on Moscow following the invasion of Ukraine

OUR BUREAU
New York/Mumbai
he conflict between Russia and
Ukraine is disrupting supplies
Tof agricultural commodities
and is likely to have a deep impact
on India’s farm sector, said Crisil Re-
search in its report released on Thurs-
day. Noting the situation as a “mixed
bag” for India’s agri-trade, it said
while the conflict creates an oppor-
tunity for wheat and maize exports, it
is also set to have an adverse impact
on the import bill of edible oils due to
higher prices.
“Both the Black Sea nations are
major suppliers of key commodities
such as wheat, sunflower oil and corn.
On its part, India is an exporter of India is one of the biggest importers of petroleum
wheat and a major importer of edi-
ble oils, including sunflower oil. Thus, edible oils, where the country is a ma- the whole month, based on current government-to-government arrange-
while the conflict creates opportunity jor importer.” shipment schedules. ment for energy imports, the people
for exports, it is also set to have an ad- Meanwhile, the jump in global “India’s legitimate energy trans- pointed out.
verse impact on the import bill due to fuel prices since the beginning of the actions should not be politicized,” a Also, the Russian envoy to India
higher prices,” said the report. conflict in Ukraine has added to In- source added. Denis Alipov on Friday said that Indi-
Crisil’s analysis comes at a time dia’s challenges, and the pressure for Energy from alternative sources an pharmaceutical companies could
when several reports flagged how the competitive sourcing has naturally in- has often come at a higher cost, and replace the demand for Western
Russia-Ukraine conflict will also ad- creased, the people said on conditions the jump in prices after the Ukraine companies in Russia. The West has
versely impact imports of fertilizers, of anonymity while explaining the gov- conflict has added to India’s chal- imposed several sanctions on Russia
creating a situation where farmers will ernment’s decision to opt for cheaper lenges. “The pressure for competitive owing to Russia’s invasion of Ukraine.
have to face higher input cost during energy from sources such as Russia. sourcing has naturally increased,” the The crisis started on 24 February, af-
the Kharif (summer crop) sowing Russia has offered crude oil and person said. ter Russian President Vladimir Putin
season if it prolongs longer. At a high other commodities at discounted The people noted that India is announced a military offensive on the
14%, India’s share in global wheat rates to India after the US and its highly dependent on imports for its East European country.
production is the same as the com- allies imposed sanctions on Moscow energy requirements, and almost However, earlier this month, Al-
bined share of Russia and Ukraine. following President Vladimir Putin’s 85% of the country’s crude oil needs ipov had said that Moscow has wel-
However, owing to higher domestic decision to invade Ukraine last month. – or five million barrels a day – is im- comed the independent foreign poli-
consumption, the country’s share in Russian oil exports to India, the ported. Most of these imports are cy of India amid the Russia-Ukraine
global wheat exports is a mere 3%. third largest energy consumer, qua- from West Asia, with Iraq accounting conflict.
Another commodity that is likely drupled in March, Financial Times for 23%, Saudi Arabia 18% and the “The withdrawal of many West-
to see the impact is maize, of which reported on Friday. Russia has so far United Arab Emirates 11%. ern companies from the Russian mar-
Ukraine is the third-largest export- exported 360,000 barrels of oil a day The people noted that Russia has ket and those niches that have been
er. “As exports from Ukraine decline, to India in March alone, nearly four so far been only a “marginal suppli- vacated may actually be occupied by
Indian maize will be able to take ad- times the 2021 average. The report er” of crude oil to India, accounting Indian companies in many industries,
vantage,” said the report. It, howev- cited Kpler, a commodities data and for less than 1% of the country’s re- in particular, in pharmaceuticals,” Al-
er, said, “India’s gains in wheat and analytics firm, to say that Russia is on quirements and not figuring among ipov told the Rossiya 24 broadcaster,
maize could well be squandered on track to hit 203,000 barrels a day for the top 10 sources. There is also no as quoted by Sputnik news agency.

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