According to the finance minister of India Nirmala Sitharaman importing Russian oil was part of the country's inflation-management strategy and that other countries were doing something similar. India had to face a huge pressure from the west to support Russia’s February invasion of UK. Instead of supporting India opt for a tactful solution that could end the violence.
She also stated in seminar organised by economic think-tank Icrier “Inflation management cannot be singularly left to the monetary policy, which has proved totally ineffective in many countries”. She throws light on the importance of synchronising with fiscal policy for RBI as one cannot completely rely on the monetary policy to avoid inflation.
Sitharaman clarified "The RBI will have to synchronise somewhat, may be not as much synchronised as other western developed countries would do. I'm not prescribing anything to the Reserve Bank... I'm not giving any forward direction to the RBI but it is the truth that India's solution to handling the economy, part of which is handling inflation also is an exercise where the fiscal policy, together with the monetary policy has to work".
Russia is the biggest foreign supplier of defence hardware to India. India is the world's third-biggest consumer and importer of crude oil. According to sources imports of crude oil from Russia had gone up from 2% to 12 % and 13 % from all sources since February as reported by the finance minister of India. Even Government Ministers consider it important to buy energy from Russia as it helps in controlling inflation. Sitharaman also credited Naredra Modi in a event organised in New Delhi. She quoted
"I give credit to the statesmanship of the prime minister to make sure globally that we did keep up the relationship with all countries but yet managed to get the Russian fuel, which is what Japan is doing today, which is what some other countries are doing". Last year the retail prices in July were higher than 6.71 %. Despite the fall in annual inflation rate for three months, it has gone above the Central bank’s capacity of 2% to 6% for seven months without a break.