Buying discounted crude oil from Russia is wise decision: Economists

New Delhi [India], September 8 : Buying crude oil with a discount from Russia is a very wise decision, and Prime Minister Narendra Modi's government has shown a lot of agility and smartness to not letting its energy prices go out of control by buying oil from Russia at discounted rates, economists said on Thursday.
Speaking on the sidelines of an event organised by the Indian Council for Research on International Economic Relations (ICRIER) here, economists said buying crude oil from Russia amid the western sanctions has been very wise relations.
The share of Russian oil in India's overall oil import basket increased from 2 per cent to 13 per cent in a couple of months after the beginning of the Russia-Ukraine war, which led to a spike in energy prices globally, Union Finance Minister Nirmala Sitharaman said on Thursday.
Ashok Gulati, Infosys Chair Professor for Agriculture, ICRIER, said this government has also shown a lot of agility and smartness to not let its energy prices go out of control by taking discounted crude oil from Russia.
If India would have not taken discounted crude oil from Russia then the retail price of petrol would have gone up to around Rs 150 to Rs 175 per litre in India, he said.
Gulati said, "Inflation is not only India's issue, countries all over the world are troubled, but India is doing better than the United Kingdom and the United States. There is 80 per cent inflation in a country like Turkey. We have more inflation right now but not out of control and hopefully very soon it should be brought down below 6 per cent."
Gulati said the challenge is how to maintain the growth.
DK Joshi, Chief Economist, Crisil said India has an alternative to take crude oil from Russia. Earlier also we have taken discounted oil from Iran. In the current situation, if we have option we should explore it because it is our need that we get crude oil at the cheapest price, Joshi said.
"After the Russia-Ukraine war crude prices were increased. We have to face double pressure as the rupee has depreciated against dollar. So it was a very wise decision that we took cheap oil from Russia," Joshi said.
Earlier, addressing the inaugural session of the event organised by ICRIER, union finance minister said the share of Russian oil import in India's overall oil import basket increased from 2 per cent to 13 per cent after sanctions imposed by the western countries due to the Russia-Ukraine conflict led to the spike in energy prices globally.
Sitharaman said the credit must be given to Prime Minister Narendra Modi's statesmanship to take the decision of boosting imports of Russian oil at discounts as it helped the country reduce import bills.
"I respect the PM for his courage to get it (crude oil) from Russia because they are willing to give on discount... our entire import had 2 per cent of Russian component, it was ramped up to 12-13 per cent within a couple of months," the finance minister said.
"Sanctions, sanctions but countries are finding their own way to get that Russian crude, gas...I give credit to the statesmanship of the Prime Minister to make sure globally that we did keep our relationship with all countries but he yet managed to get the Russian fuel which is what Japan is doing today," she said.
Sitharaman said increase in oil imports at a discounted price from Russia is a part of the "inflation management".