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For India, Russia, Diversifying Energy Ties a Natural Fit

Thursday, May 22, 2014

Russia and India are reportedly considering a $30 billion oil pipeline that would transit through China’s Xinjiang province. When seen in the context of other bilateral hydrocarbon initiatives between India and Russia, the discussions, first reported in late March, show that Russia is cultivating India in addition to China as part of its accelerated move away from dependence on European markets amid the ongoing Ukraine crisis.

For its part, India, which has been on the lookout for stable sources of hydrocarbons outside the Middle East, finds a natural fit in Russia, given the two countries’ traditional ties and Russia’s vast new unexploited offshore and unconventional reserves. Moreover, given the amount of investment under discussion for joint projects in the hydrocarbon sector, India now appears to be leaning more on its pre-existing energy relationship with Russia than pushing for greater access to U.S. unconventional hydrocarbons. But given the geographical route of direct overland supplies from Russia to India, any joint hydrocarbon initiatives will depend on how the Chinese evaluate the benefits of facilitating such linkages. ...

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