How Modi’s Russia-Ukraine Policy Coopted India’s Opposition

Author
Kavita Krishnan
Date
September 5, 2023
In English
En castellano

India’s democrats have missed a chance to attack a policy that helps Putin’s war and undermines India’s democracy.

In the 18 months since Russia’s full-scale invasion of Ukraine, India’s Narendra Modi has been one of Vladimir Putin’s most valuable tacit supporters. The two have much in common: authoritarian, reactionary, and ruthless in pursuit of their interests, unburdened by any moderating principle of democracy or human rights.

More surprising, perhaps, has been the reaction of India’s opposition: from moderate liberals to the left, the large majority have thrown their weight behind Modi’s policy or urged him to go further. The result has been an opposition disarmed in its principal domestic battles: for economic justice and an inclusive democracy, both of which are imperiled by the Modi government’s Hindu-supremacist politics and crony capitalist economic policies.

Officially neutral, India abstained repeatedly at the United Nations on resolutions against the invasion. More consequentially, Modi has had India act as a conduit for sanctioned Russian oil, providing an important prop for Russia’s beleaguered war economy. Minister of External Affairs S. Jaishankar said that India was morally obliged, in the interests of its poor, to continue buying Russian oil. The sanctions had lowered prices, and buying at a discount, Jaishankar indicated, would bring energy costs down for Indian citizens.

Since the invasion, India’s imports of Russian oil rose from 1 percent to 40 percent of its total oil imports, but petrol and diesel prices remained as high as ever for consumers—neither falling nor rising. If the Indian people have not felt the benefit of this decision, others have. It has enriched, on an extravagant scale, two private companies whose business interests overlap considerably with the political interests of both Prime Minister Modi and President Putin.

A Petro-Alliance And Graft Scandals

Nearly half of India’s imports of Russian oil (45 percent as of March, 69 percent as of May) were cornered by just two private refineries. One, Reliance, is owned by Mukesh Ambani, a business tycoon known to enjoy a close and mutually beneficial relationship with Modi. The other, Nayara Energy, is a subsidiary of the Russian state-owned oil company Rosneft. The two private companies reduced their domestic fuel sales to the barest minimum required of them and sold the refined oil at a huge mark-up on the international market. The massive benefits they enjoyed from laundering Russian crude did not trickle down to India’s consumers.

In contrast, India’s state-owned refiners, which meet 90 percent of the needs of Indian consumers—private companies are required to supply only 10,000 of 65,000 pumps—“largely buy oil under annual term supply deals,” so were not able to easily shift their purchases to the cheaper Russian crude. Even when the annual term contracts were due for renewal, many state-owned companies were wary of replacing West Asian suppliers that had proved “reliable for decades,” with Russian suppliers liable to be fickle and short-lived. Had the public sector companies benefited more from cheaper imports, consumer prices could have fallen.

Simultaneously, Russian oil exporters have artificially inflated the shipping fees they charge Indian importers in order to mitigate the U.S. and EU-initiated price cap. An official at a state-owned refinery said that “no negotiation was allowed [by Russian vendors] over freight arrangements or costs,” the Financial Times reported. In recent months, the price of Russian oil has increased above the $60 cap, even before adjusting for shipping costs. Nonetheless, after inflated shipping costs, Indian importers of Russian crude save around $11 per barrel as compared to world prices.

The notion that Indian consumers were spared the steep rise in pump prices that the rest of world has suffered, thanks to India’s decision to circumvent sanctions, is debatable. It was, after all, the public sector that bore the burden of supplying the domestic market, largely on the basis of oil imported from elsewhere than Russia, and thus at inflated global prices.

Nayara’s history is instructive. Rosneft bought the refinery in 2016 from Essar Oil, paying more than twice the refinery’s previously estimated worth. This deal was nearly dead until it was mysteriously revived at the last minute, reportedly through the personal intervention of Putin and Modi. It “rescued debt-ridden Essar Oil from bankruptcy” and “gave Rosneft access to the large Indian market” at a time when it was facing international sanctions resulting from Russia’s annexation of Ukraine’s Crimea in 2014. Also in 2016, Indian public sector energy firms heavily overpaid to acquire a 49 percent stake in the Rosneft subsidiary Vankor, at a time when production in Vankor oil fields was falling and the company was under sanctions.

Jairam Ramesh, an MP of the Indian National Congress, the leading opposition party, said that the acquisition of Essar by Rosneft indicated “a suspicious pattern in which public sector units overpay a Russian firm for an oil asset, which, in turn, overpays a politically-connected private Indian firm for another energy asset.” He asked Modi, “did you transfer Indian taxpayer money to the pockets of private Indian companies to help finance your political activities?”

He raised this question in the wake of the Hindenburg report, which exposed the corrupt empire of Gautam Adani, the tycoon in the closest corporate embrace with Modi. Pointing out that Russia’s state-owned VT Bank’s role was involved with the Adani and Essar transactions, Ramesh asked the prime minister to clarify his government’s involvement “in a global kleptocratic network involving other firms with deep political connections.”

Rosneft’s Nayara Energy and Reliance have both reaped a huge windfall laundering Russian crude: acting as a conduit for Russia to bypass sanctions and reach Western markets in the form of refined products. Naturally, the Western countries that buy the laundered oil from India are complicit in bypassing the sanctions they themselves have imposed.

In a related development, the mysterious Mumbai-based shipping company Gatik Ship Management added 56 tankers to its fleet (from just two) since the 2022 invasion. On paper Gatik is owned by an offshore company in the Marshall Islands, which hides the real identity of its owner. However, it is strongly suspected to be a monopoly transporter of crude oil from Russia to Rosneft’s Nayara refinery in Gujarat.

Gatik is the largest of the “dark fleets” transporting Russian oil, which have mushroomed globally since the war. This scam lets Russian transporters get Western insurance coverage even if they’re in violation of the price cap placed by sanctions on Russian crude. In June 2023, Gatik lost Western insurance cover, and its website mysteriously disappeared. But such dark fleets are designed to emerge and then melt away: their rise and fall have been compared “to the brief careers of TikTok stars.”

Jawahar Sircar, an MP of the Trinamool Congress, a smaller opposition party, noted in a May article that this overnight expansion of a shipping company dedicated to imports of Russian oil was “a mammoth operation [that] could not have taken place without official patronage and the assistance of both countries.”

“Having watched Narendra Modi for nine years, of which more than two were spent ‘in his government,” he wrote, “I can state with certainty that every action of his has an ulterior motive of helping someone make huge profits. I guess these crony capitalists, in turn, look after Modi’s needs.”

Gujarat, Modi’s own personal stronghold for decades, is home to Mukesh Ambani and Gautam Adani, to the Reliance and Essar-Rosneft refineries, and to the Vadinar port from where the Gatik tankers set sail.

The Opposition Flounders

All this amounts to a graft scandal in plain sight. Surprisingly, India’s opposition has not sought to exploit this scandal even though it has pursued such scandals in the past. For example, all opposition parties— especially the Left—diligently questioned the prime minister’s personal role in the 2015 Rafale deal with French aviation company DassaultIt was a major issue for the opposition in the 2019 parliamentary elections.

But when it comes to Russia’s invasion of Ukraine, a different approach applies. Most opposition parties have explicitly supported the Modi government’s claim to act in the “national interest” by circumventing sanctions, even though the prime minister’s cronies, not ordinary Indians, have benefited.

In June, Congress leader Rahul Gandhi endorsed the government’s policy towards the invasion, saying that India had “certain dependencies” on Russia and must “look for its own interest.” MPs who spoke in parliament on the subject were nearly unanimous in urging the government to maintain neutrality between Russia and the West to serve India’s “national interests.” Last year, even those Congress MPs such as Shashi Tharoor and Manish Tewari who had been critical of Russia ultimately lined up behind their party’s policy. “Does Russia alone bear responsibility for this conflict? The Anglo-American alliance bears equal responsibility,” Tewari said. The leader of a smaller, regional opposition party, the Trinamool Congress, wrote to the prime minister declaring that the government’s policy deserved patriotic support from all. Alone among MPs, T. Sumathy of the Dravida Progressive Party, which has its base among Tamils, explicitly supported Ukrainian resistance.

On the Left, the Communist Party of India (Marxist) took an even more pro-Russia position on UN votes than the government. Its general secretary accused Modi of “joining” with America and sacrificing India’s “independent foreign policy,” by refusing to vote with Russia. The CPI(M) called on the government to “circumvent U.S. sanctions against Russia and work out a discounted energy deal with Moscow,” This was indistinguishable from the government’s own position. They did not even demand that the energy discounts be secured for public sector oil companies, and hence used to reduce pump prices. India’s largest communist party, which still rules Kerala, thus placed its own reputation for incorruptibility and defense of the underprivileged at the service of the government. It allowed Modi to present his self-serving oil deal as a response to popular demand and an expression of his independence from U.S. pressure.

In fact, “U.S. pressure” on India over sanctions is a useful fiction for both countries. As early as March 2022, the United States had indicated its tacit acceptance of India’s position, and in the year and a half since, it has made it even clearer that it is comfortable with India’s relationship with Russia. The United States and other Western countries, prevented by sanctions from buying oil directly from Russia, mitigate the resulting energy crises at home by buying the “laundered” product from India. The U.S. argument is that the price caps imposed by the West would help India and China negotiate cheaper rates that would squeeze Russia. As in the case of Gatik shipping, India enables Russia to evade the price caps, and the United States has not raised this matter with India as part of its diplomacy.

The Communist Party of India (Marxist-Leninist), which has some electoral presence in the north Indian states of Bihar and Jharkhand, acknowledged that the “repeated abstentions [at the UN] smack of an indirect endorsement of Putin’s war.” But it too retained the broader framework of analysis that held Russian “aggression” as well as US/NATO “interference” responsible for the war. It urged the Modi government to “adopt a proactive role to stop Russian military intervention in Ukraine and the ongoing military mobilization by NATO.” But there is no military mobilization by NATO. Speaking of NATO and remaining silent on the only military mobilization against Russia—Ukraine’s own national resistance to the invasion—casts Ukraine as a NATO proxy and denies it recognition of the very political and geopolitical autonomy it is fighting to defend. Formal support for Ukraine’s self-determination comes with a condemnation of the means available to it to defend that self-determination.

The CPI(ML) has not taken any position on the sanctions and oil deals or on the cronyism demonstrated in the time since the invasion. In its view, the Modi government’s “indirect” support for Russia demonstrated “foreign policy paralysis,” which is a result of its attempts to balance its increasing “strategic subservience to the American design of global hegemony” and its ideological affinity with Putin as a far-right strongman and its fear of “antagonizing Russia.” Such an analysis is not merely inaccurate. It serves to obfuscate and mislead. Modi’s foreign policy is far from paralyzed and indirect: it is direct and proactive in pursuing his own political interests through the commercial interests of corporate cronies. His government is not “afraid of antagonizing Russia.”—it sees itself as Russia’s partner in the project of achieving global hegemony for authoritarian and reactionary values and forces (including in the West), and recognizes the invasion of Ukraine as a crucial element of that project.

India’s opposition has thus given a free pass to the Modi regime by endorsing a policy that “serves the national interest” but that in reality appeases Russia, betrays Ukraine, promotes a reactionary world order, and delivers huge benefits for Modi’s crony allies.

Multipolar Relativism against Solidarity

The opposition parties have endorsed another version of the “national interest” argument that also undermines their own defense of democracy in India.

Across all divides, the Indian political and public sphere argues that a “peaceful, negotiated resolution” of the Ukraine conflict is needed that doesn’t diminish Russia’s stature as a major power. The consensus is that Russia’s big power status must be protected in the interests of a “multipolar world order,” which in turn is in India’s “national interest.”

According to a prominent journalist, for instance, “It is in India’s interest for Russia to remain a salient global power centre. For Russia to be defanged would hasten the emergence of bipolar hegemony. India’s refusal to condemn Russia is rooted in its national interest being served by a multipolar, rather than a bipolar, world.” Parliamentarians made much the same argument, with some substituting “unipolar” for “bipolar” as the antonym of “multipolar.”

A variation of the same argument puts a progressive gloss on the same underlying logic: “Regardless of the internal character of competing global powers,” the general secretary of the CPI(ML) wrote, “a multipolar world is certainly more advantageous to progressive forces and movements worldwide in their quest for reversal of neoliberal policies, social transformation and political advance.”

Disregard for nations’ internal democracy is the norm, not the exception, in the “liberal democratic” world order. The United States and the West appease Modi in disregard of his regime’s erosion of India’s internal democracy, just as they appeased Putin, disregarding his intensifying attacks on Russia’s fledgling internal democracy and his violations of international laws. What is new, perhaps, is that such cynical realpolitik is now being dignified as principle even by left parties and intellectuals who want a reputation as partisans of democracy.

In the “multipolar world order” of Putin, Xi, Trump, Modi, and others, every regime is expected to comply with just one universally accepted norm: that each will disregard the crimes committed by each other in pursuit of their “national interests” within their respective spheres of influence. Democratic principles are to have no international standing and may not exert the slightest moral restraint on any regime.

Opposition parties have joined the chorus for a multipolar order but have completely ignored what such an order actually means.  An exception is Congress MP Manish Tewari who did hint that the Ukraine war is a sign of a “new iron curtain” descending on the world, behind which are Russia, China and their allies including Syria, Iran, North Korea, and Myanmar. India, he said, has to choose if it wants to be seen in the company of these authoritarian regimes “or on the side of Western democracies howsoever imperfect and hypocritical they may be.”

But Tewari is wrong to pose the problem as a choice between democratic and authoritarian nations divided by a rigid iron curtain. The divide isn’t vertical. Inside every nation, even “Western democracies,” are political forces that share a vision of a democracy-free world order with their counterparts in other nations. The choice isn’t between Western democracies and their authoritarian adversaries. People need to choose democracy within their own country—and demand that their elected governments choose democracy and justice every time, including in international relations.

The various “questions” of the past—pertaining to slaves, castes, women, LGBTQ—are no longer questions  thanks to slaves, women, homosexuals, and others who fought to establish that their humanity and dignity is beyond question. “Multipolarity” has come to mean a project of discrediting these answers as an alien system imposed by western elites, in favor of majoritarian values that authoritarian leaders claim to be “civilizational” and therefore authentic. ModiPutin, the Russian fascist Alexandr Dugin, and Xi Jinping are leading advocates of such “civilizational”, rather than universal, values.

Those challenging majoritarianism internally are called traitors by such regimes. The Modi government says protest organizers and human rights defenders are conspirators against this same “national interest.” If “national interests” prevail over the interests of justice in foreign policy, then the political ground to argue that injustice is incompatible with the “national interest” at home is lost.

Political values drive foreign policy. Anti-democratic political forces pursue an anti-democratic order both at home and abroad. For its most powerful advocates, the “multipolar world order” is one in which “democracy” is uprooted from its moorings, emptied of meaning, and reduced to a floating sign that every tyrant and fascist can daub on his own banner.

The disregard for democracy displayed by “left” multipolarists is reflected at home and abroad. Vijay Prashad says we cannot look at BRICS (that now includes Saudi Arabia and Iran) “in a narrow, moralistic way” as “tyrannies and carbon-addicted economies,” but “in a realistic and dialectical way.” Modi’s government might be “ravaging democracy,” but one could still appreciate it for “turning around to the Western countries and saying your issues are not our issues, India is not interested in the NATO template.” Earlier he enthused that “Iran might disagree on some social policies with Venezuela” but both are uniting to “produce a multipolar world.” On this account, murderous oppression is mere “social policy,” an exercise of sovereign state power, to be disregarded by others. What would such “multipolarity” mean to the women of Iran demanding “Woman, Life, Freedom” and “Death to the dictator! Democracy, equality!”? That “Woman, Life, Freedom” became a popular slogan that echoed across the world is evidence that “democracy” is not the property of “Western elites” but is a universal aspiration across diverse regions, countries, and cultures.

Modi attempts to establish the values of caste and gender hierarchy as authentic democracy. He says that Hindu civilization, as the “Mother of Democracy,” needs no lessons from the West. Dugin in a 2020 piece in the Indian journal Seminar, hails “the electoral success of Narendra Modi” as a challenge to “the false pretensions of so-called ‘universality’ of ‘western values’.” He explains further that “multipolarity thus implies a return to the civilizational foundations of each non-western civilization” and a rejection of “liberal democracy and human rights ideology.”

In domestic politics, India’s opposition purports to oppose Modi’s attempts to impose “civilizational” majoritarianism over the country’s pluralist and constitutional democracy. Yet in foreign policy, that same opposition defends policy that not only upholds Modi’s regressive values but specifically enriches and enables his corrupt private circle, and therefore strengthens his political base. The price of challenging this sort of kleptocracy would be determination to oppose its real source: a foreign policy that places geopolitics over democracy, and civilizational values over universal ones. The price of cowardice is already clear: acquiescence in the lie that Modi acts for the Indian people, rather than that of his own clique, and the forsaken opportunity for the democratic opposition to distinguish itself from the Modi government.