India, Russia To Discuss Energy Security As Oil, Coal Prices Soar

India and other members of the Shanghai Cooperation Organisation (SCO) will discuss energy security at the regional security bloc's meeting in Uzbekistan, India's foreign secretary Vinay Kwatra said on Thursday.

The two-day summit in the Silk Road city of Samarkand will be attended by Prime Minister Narendra Modi, Chinese Premier Xi Jinping, Russian President Vladimir Putin and Pakistan Prime Minister Shehbaz Sharif, among others.

It coincides with a sharp rise in Indian imports of Russian oil, coal and fertiliser, a vital outlet for Moscow as it seeks to secure new markets after Western sanctions were imposed following the invasion of Ukraine.

"When we talk about economic cooperation in the context of SCO, then questions about energy security and other issues ... will be a part of the discussions," Kwatra said when asked if energy security and currency swaps would be discussed during Modi's trip.

The SCO originated in the 1990s with a security agreement between Russia, China and ex-Soviet states in central Asia. India and Pakistan joined five years ago, making it the world's biggest regional organisation, comprising 40% of the world's population and more than half of the Eurasian land mass.

Discussions at the two-day summit from Thursday will involve "topical, regional and international issues, reform and expansion of SCO, the security situation in the region ... strengthening connectivity as well as boosting trading and tourism in the region," Kwatra added.

The Kremlin has said Putin and Modi will meet on Friday and discuss trade, including food, as well as sales of Russian fertilizer.

Refiners in India, who rarely bought Russian oil before the Ukraine war, have boosted imports to a record 757,000 barrels per day in April-August compared with 20,000 bpd a year earlier, data from industry sources showed.

Russia, the biggest oil producer in the SCO bloc, has also overtaken the United States to emerge as India's fourth largest coal supplier.

Indian imports of coal surged to 9.35 million tonnes in the six full months since the invasion, nearly double the 4.83 million tonnes during the same period in 2021, data from Indian consultancy Coalmint showed.

For fertilisers, India's imports from Russia rose to $1.03 billion in April-July 2022 compared with $150.28 million in the same period last year, according to the Indian commerce ministry's website.

The Reserve Bank of India in July introduced a mechanism to settle international trade in rupees to stave off the impact of the depreciation of global currencies, a move seen as aiding trade with Russia.

A prominent trade body estimates the use of rupees could boost India's exports to Russia to about $5 billion in 2022/23, up from $3.3 billion in the last fiscal year.

However, India's exports to Russia have slowed since the Ukraine conflict began. In April-July, they fell by about a third from the same period in 2021, according to government data.

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