Indian companies bought Russian coal using yuan, euro instead of US dollar
- Russia overtook China as India's third-largest coal supplier in July
- Indian purchasers paid for 742,000 tonnes of Russian coal in currencies other than the US dollar
- Indian companies purchased coal in the United Arab Emirates dirham, Hong Kong dollar, yuan, and euro
India drastically increased its purchases of Russian coal in July after moving to non-dollar settlements to secure deals. Indian vendors are increasingly paying with Asian currencies rather than the U.S. dollar to minimize the risk of violating Western sanctions on Moscow, according to Reuters.
Since the start of the Ukraine war, India has aggressively increased its imports of Russian oil and coal to get raw resources at a lower cost than those from other nations.
Russia overtook China as India's third-largest coal supplier in July, with imports increasing by more than a fifth over June to a record 2.06 million tonnes. Historically, Russia has been India's sixth-largest coal supplier, trailing Indonesia, South Africa, Australia, and the United States, with Mozambique and Colombia alternately being in the top five.
According to Reuters, Indian purchasers paid for at least 742,000 tonnes of Russian coal in currencies other than the US dollar in June, accounting for 44% of the 1.7 million tonnes of Russian imports that month. In recent weeks, Indian steelmakers and cement producers purchased Russian coal in the United Arab Emirates dirham, Hong Kong dollar, yuan, and euro.
In June, the yuan accounted for 31% of non-US currency payments for Russian coal, while the Hong Kong dollar accounted for 28% and as per Reuters, the euro accounted for less than a quarter of the total, with the Emirati dirham accounting for almost one-sixth.
Jindal Steel and Power Ltd (JSPL) purchased 79,721 tonnes of so-called PCI coal in the vessel, Zheng Kai, from Russia's Ust-Luga port using yuan while ArcelorMittal Nippon Steel India imported 35,000 tonnes of Russian anthracite coal using euros, reported Reuters citing sources.
On Thursday, the Indian rupee fell 6 paise to 79.31 against the US dollar in early trade. The Indian equity benchmark rose in opening trade with the Sensex rising 581.26 points to 59,398.55 and the Nifty advancing 159.80 points to 17,694.55.