Dollar Diplomacy vs. Rupee Resolve: India’s Modest Trade Ties with Russia Pale Before U.S. Giant

New Delhi | 09 Sept 2025 | www.externalaffairs.in

As geopolitical dynamics shift in the wake of the Ukraine war and the West’s economic sanctions on Moscow, a striking disparity in trade volumes continues to reflect the stark contrast between the world’s superpower economies and emerging ones. A comparative look at Russia’s trade partnerships with the United States and India exposes the divergent scales and strategic imperatives that underpin their foreign economic policies.

The U.S.–Russia Trade Snapshot (Pre-War Highs)
Before the Ukraine conflict escalated in 2022, the United States traded over $34.6 billion annually with Russia (2021), with exports totaling approximately $6.4 billion and imports exceeding $28 billion. However, post-sanctions and the tightening economic noose by Washington, bilateral trade plummeted to just $9.5 billion by 2023 — a nearly 70% decline — showcasing the strategic decoupling of the two powers.

India–Russia Trade: Rising, but Modest
In contrast, India–Russia trade reached a record high of $65 billion in 2023–24, driven primarily by India's massive import of discounted Russian crude oil, which surged as India sought to balance energy security with geopolitical neutrality. Despite this uptick, the trade remains heavily skewed: over 90% of India’s imports from Russia comprise crude oil and fertilizers, while Indian exports to Russia remain below $5 billion.

What This Means in Global Terms
While India’s current trade volume with Russia exceeds the post-sanctions US–Russia trade in raw numbers, it lacks diversity and long-term balance. Indian policymakers have underlined the need to boost Indian exports — pharmaceuticals, machinery, IT services — to avoid a one-sided relationship dominated by energy dependence.

Strategic Implications
The data also reveals India’s cautious but pragmatic stance — deepening economic ties with Moscow without compromising its strategic partnerships with the West. As India eyes a greater role in the multipolar world, its ability to navigate such asymmetric trade relations will be critical in shaping its diplomatic leverage.