*Paromita Das
The Russia-Ukraine conflict, as well as Western sanctions against Russia, has created more opportunities for Indian businesses than had been anticipated.
In 2019, India and Russia announced their intention to connect the ports of Chennai and Vladivostok, respectively. After a year, the project is still only on paper. This paper examines the proposed maritime connectivity corridor’s economic and strategic viability.
But while the world’s attention is focused on the Ukraine conflict and another emerging hotspot in Taiwan, a very practical and well-thought-out multi-modal transit corridor has been established that connects St Petersburg, Russia, on the Baltic Sea, to the Jawaharlal Nehru Port Trust or JLN Port (also known as NhavaSheva Port) near Mumbai on the Arabian Sea coast. This trade route has the potential to significantly boost India-Russia trade, particularly in fossil fuels such as crude oil, LNG, and other oil-based products. After the United States and China, India is the world’s third-largest oil importer and consumer.
India has already increased its imports of Russian oil by tenfold since February, taking advantage of deep discounts on offer. Russian crude now meets 20% of India’s requirement.
According to the most recent data, Russia has surpassed Saudi Arabia to become India’s second-largest oil supplier. Iraq continues to be India’s primary oil supplier. The energy trade will only expand as the world’s energy needs increase. The new route, known as the International North South Transport Corridor (INSTC), spans 7,200 kilometers of sea, rail, and road, making it the shortest and most cost-effective way to connect India and Europe while avoiding trouble spots such as Afghanistan and Central and West Asia.
The state-owned Islamic Republic of Iran Shipping Lines Group (IRISL) has already successfully tested the trade route in collaboration with its regional branches in Russia and India. The test run, which began in St Petersburg and ended in Mumbai’s JLN Port, involved transporting a Russian 41-ton cargo consisting of two 40-foot containers containing wood laminate through Iran. St Petersburg, for example, is home to many of Russia’s largest state-owned energy companies, such as Gazprom, and is near the origin of major Russian gas pipelines such as the Nordic Stream 1 and 2. St Petersburg is a major trade and industrial center with three large cargo seaports.
JLN Port, on the other hand, is India’s largest container port. Because crude oil and LNG sent directly from a Russian port to an Indian port and paid in non-dollar currency would technically avoid sanctions, such a transit trade corridor would help India avoid US sanctions against Russia. The traditional 40-day, 8,675 nautical mile circuitous sea route from St Petersburg to Rotterdam, Netherlands, and then through the Suez Canal to reach India will now take only 25 days.
The new route will start in St. Petersburg and travel across western Russia to Astrakhan, the Caspian seaport. It will then take ships across the Caspian Sea to the Iranian port of Anzali in the north. The route follows the highway from Anzali to Bandar Abbas, Iran’s southernmost port on the Persian Gulf, where a sea route connects to the JLN Port.
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