Indian firms flouting Russian sanctions will face consequences: US Ambassador

Garcetti says oil is an important commodity that US doesn’t want to restrict as long as ‘price cap’ enforced [View in browser]( [See all newsletters]( 01 July 2024 Indian firms flouting Russian sanctions will face consequences: US Ambassador [US Ambassador to India Eric Garcetti ] Any Indian company that violates global sanctions against [Russia]( will have to be aware of the “consequences” they face when they are trying to do business with countries in Europe, America and their global allies around the world, US Ambassador to India Eric Garcetti has said. “The US, together with dozens of allies, is standing up against the idea that one country by brute force should be able to take the land of another. Let me hope that India will continue to recognise that principle and work with us to identify those companies that are fueling the Russian war machine…,” Garcetti said in a video interview with businessline. - Also read: [Indian refiners maintain buy momentum on Russian, Iraqi crude as Saudi cargoes become costlier]( Punitive measures Garcetti’s statement gains added relevance as earlier this month, Japan announced sanctions against Bengaluru-based Si2 Microsystems, which designs and manufactures electronics equipment, for “helping Russia evade” punitive measures related to its invasion of Ukraine. The same company was sanctioned by the European Union in February this year and the US last November for allegedly supporting Russia’s military and defence industrial base. Interestingly, just a month before the US sanctions on Si2 Microsystems, it was named by the Ministry of Electronics and Information Technology as one of the industry partners at the launch of Silicon Photonics Research Centre of Excellence at IIT Madras. Garcetti said there was no problem with India’s energy trade with Russia as no one had the impression that India was breaking some sort of rules. Many countries together had decided on a price cap for Russian oil that would limit Moscow’s earnings and India was taking care of its enforcement. “Oil is an important commodity that the US does not want to restrict as it would make everybody’s cost go up,” he said. - Also read: [Russia offers floating nuclear plant tech to India]( “That said, I don’t think I have to remind my Indian friends that the most sacred and sacrosanct thing that we have in our international relations are our borders…We need to work together to make sure the Russian war machine does not continue to go on for ever,” Garcetti added. To check flow of funds and arms to Russia, the US reportedly sanctioned over 4,000 Russian businesses and individuals since the country invaded Ukraine in February 2022. Fear factor The fear of third country sanctions is one of the factors behind Indian exports to Russia not reaching its full potential despite the two governments putting in place a rupee payment mechanism. “Indian exporters of network products that are part of a global value chain, such as computers, electronics and telecom equipment are not keen on exporting to Russia as they fear sanctions against them in Western countries that would affect their business,” an official explained. While India’s exports to Russia increased 35 per cent (year-on-year) in 2023-24 to $4.26 billion its imports were much higher at $61.43 billion (growing 33 per cent) with oil imports at $54.5 billion. You Might Also Like [Domestic institutions ramp up buying in first half]( [Markets]( [Domestic institutions ramp up buying in first half]( [RMZ Corp to sell One Paramount in Chennai to Keppel for ₹2,100 crore]( [Real Estate]( [RMZ Corp to sell One Paramount in Chennai to Keppel for ₹2,100 crore]( [Indian IT firms likely to face short term headwinds, see decline in BFSI and telecom sectors]( [Info-tech]( [Indian IT firms likely to face short term headwinds, see decline in BFSI and telecom sectors]( [Mumbai June property registrations up 12% YoY but down 3.6% MoM]( [Real Estate]( [Mumbai June property registrations up 12% YoY but down 3.6% MoM]( Stay informed Subscribe to businessline to stay up-to-date with in-depth business news from India [arrow]( Copyright @ 2024, THG PUBLISHING PVT LTD. If you are facing any trouble in viewing this newsletter, please try [here]( Manage your newsletter subscription preferences [here]( If you do not wish to receive such emails go [here](