Indian oil companies are struggling to bring home nearly $1.4 billion (₹11,700 crore) from their energy investments in Russia. The money is stuck due to international sanctions and payment restrictions linked to the Russia-Ukraine war.
Why is the money stuck?
- The funds are earnings from Indian state-owned firms’ stakes in Russian oil and gas projects.
- International sanctions on Russia’s banking and financial system have made it difficult to transfer profits back to India.
- Oil companies are exploring ways to use the money locally in Russia or find alternative settlement routes.
Which companies are affected?
- ONGC Videsh Ltd (OVL) – India’s biggest overseas oil and gas player.
- Indian Oil Corporation (IOC).
- Bharat Petroleum (BPCL).
These firms collectively hold stakes in key Russian projects, including Sakhalin-1 and Vankor oilfields.
What it means for India
- The stuck money reduces immediate cash flows for Indian firms.
- However, India continues to import discounted Russian crude, which has helped lower fuel costs at home.
- Experts say the issue is financial, not operational, meaning oil production and supplies remain unaffected.
What’s next?
The Indian government is in talks with Moscow to find solutions. Options include:
- Reinvesting the profits in Russia itself.
- Exploring rupee-ruble settlement systems.
- Using alternate trade mechanisms to bypass sanction-related hurdles.
Summary Table
| Detail | Information |
|---|---|
| Amount Stuck | $1.4 billion (₹11,700 crore) |
| Companies Affected | ONGC Videsh, Indian Oil Corporation, Bharat Petroleum |
| Projects Involved | Sakhalin-1, Vankor oilfields, others |
| Reason | Sanctions and banking restrictions on Russia |
| Impact | Funds blocked, but oil supply to India continues |
| Possible Solutions | Reinvestment in Russia, rupee-ruble trade, and alternate routes |
