India meets nearly 80 percent of its oil needs through imports MUMBAI: Shares of Future Group companies fell sharply on Monday, some as much as 20 percent, after India’s biggest retailer Reliance called off its $3.4 billion deal with the group over the weekend, pushing its flagship Future Retail towards possible bankruptcy. Shares of Future Supply Chain Solutions, Future Retail, Future Lifestyle Fashions, Future Consumer and Future Enterprises fell between 5 percent and 20 percent. With Reliance calling off the deal, Future, once one of India’s biggest retailers, now faces the prospect of a bankruptcy process. India’s Russian oil purchases double since Ukraine invasion India has bought more than twice as much crude oil from Russia in the two months since the invasion of Ukraine as it did in the whole of 2021, according to Reuters calculations, as Indian refiners snapped up discounted oil that others have shunned. Refiners in India have placed orders for at least 40 million barrels of Russian oil since the invasion on Feb. 24, Reuters calculations based on information from crude tenders and traders show. The purchases are for loading in the June quarter. That compares with total imports of Russian oil into India of 16 million barrels in the whole of last year, according to Reuters. The world’s third-biggest oil importer and consumer ships in over 85 percent of its crude oil needs of 5 million barrels per day. Its refiners are buying cheaper Russian oil to partly offset the impact of higher official selling prices of some producers like Saudi Arabia, company sources said. “We try to insulate consumers as much from price shocks as we can, but we need to protect our profits as well... so we are buying Russian oil,” an official at one refiner, who declined to be named, said. According to Reuters calculations, purchases of Russian barrels by private refiners Reliance Industries and Nayara Energy outstrip imports by state refiners Indian Oil Corp., Hindustan Petroleum Corp., and Bharat Petroleum Corp. Reliance has purchased at least 15 million barrels of Russian oil so far for the June quarter, trade sources said last week. Reliance did not respond to a request for comment at that time. Russian oil imports are not sufficient for India’s needs Defending India’s oil imports from Russia, the country’s oil minister Hardeep Singh Puri said that India’s purchases from Russia are a minuscule fraction of the country’s overall oil needs. Indian companies are buying Russian oil on a delivered basis, with sellers arranging for shipping and insurance. Washington has already said it does not object to New Delhi buying Russian oil below market rates but warned against a steep rise in imports as that could hamper the US response to the war in Ukraine. UBS trims India growth forecast Meanwhile, UBS Group AG has cut India’s 2022-23 economic growth forecast by 70 basis points to 7 percent on Friday, citing slowing global growth due to high commodity prices, and weak local demand because of energy price hikes, inflationary pressures and a struggling labor market. The downgrade comes a week after the World Bank lowered its economic growth forecast for India and the whole of South Asia, citing worsening supply bottlenecks and rising inflation risks along with the Ukraine Russia crisis. “We believe the pass-through of high global commodity prices to the real economy will affect households’ purchasing power and company margins, and constrain the fiscal space available for capex,” UBS economist Tanvee Gupta Jain said in a note. India meets nearly 80 percent of its oil needs through imports and rising crude prices push up the country’s trade and current account deficit while also hurting the rupee and fueling imported inflation. The Reserve Bank of India earlier this month raised its inflation forecast for the current fiscal year to 5.7 percent, 120 basis points above its forecast in February, while cutting its economic growth estimate to 7.2 percent from 7.8 percent. UBS expects India’s gross domestic product growth to settle at a rate of 6 percent per annum beyond 2023. EU, India broaden trade ties The EU and India agreed on Monday to set up a trade and technology council to step up cooperation, as the bloc’s chief held talks with officials in New Delhi, who have seen a flurry of top visits since the start of the Ukraine war. European Commission President Ursula von der Leyen is on a two-day trip to India’s capital, part of Western efforts to encourage New Delhi to reduce ties to Russia, its main weapons supplier, following Moscow’s invasion of Ukraine. India has refrained from explicitly condemning Russia’s invasion, while calling for an immediate end to violence. Moscow calls its actions in Ukraine a “special military operation.” The US is the only other country that has a technical agreement with the EU similar to the one signed on Monday with India. “I think this relationship today is more important than ever,” von der Leyen said in her opening remarks during a meeting with Indian Prime Minister Narendra Modi. She added, “We have a lot in common but we are also facing a challenging political landscape.” (With inputs from Reuters)