US consulate ‘asks’ Mumbai Port Authority to stop Russian ships from docking; India objects



A letter issued by the U.S. Consulate General in Mumbai to the Mumbai Port Authority in India is in the eye of a storm. In its letter, the U.S. consulate has asked the Indian port authorities to disallow Russian vessels from docking. The Indian authorities have shot back its, ‘India’s sovereign decision to engage with countries in national interests’.

The Economic Times has quoted sources who have stated India’s sovereign decision to engage with countries in national interests. ET has reported that India has taken exception to the suggestion by the U.S. consulate (Mumbai) that Russian ships should not be allowed at Mumbai port and has asserted that it is New Delhi’s sovereign right to deal with global partners on national interests.

Derek Grossman, a senior defense analyst at the RAND Corporation, focused on a range of national security policy and Indo-Pacific security issues, has criticized the move in his tweet: “Seems Biden admin has shifted tactics when pressuring India. Instead of speaking directly to New Delhi, the U.S. consulate in Mumbai writes a letter to Mumbai Port Authority to bar Russian ships. Of course, New Delhi found out. The silly move by the U.S.”

The move of the U.S. Consulate General in Mumbai to communicate directly with the Indian port authority in May has surprised many at the South Block (where the Union Ministry of External Affairs is located).

On receipt of the communication from US Consulate General, the Mumbai Port Authority has written to the Directorate General of Shipping, which in turn has sought instructions from the Union Ministry of External Affairs.

The Economic Times has reported that India is a “key importer” of oil from Russia to meet the country’s rapidly increasing oil requirements. The report also says that India is looking to expand its presence in oil assets from Russian Far East. While, to boost bilateral trade and strengthen supply of critical raw material, Russia recently launched chartered ships to India.

Meanwhile, on Tuesday the Reserve Bank of India announced its decision to allow international trade in Indian rupees which would reduce the dependence on dollars. The move is also aimed at boosting trade with Russia.

The RBI, in a circular issued to all Category-I Authorised Dealer (AD) banks has stated: “In order to promote growth of global trade with emphasis on exports from India and to support the increasing interest of global trading community in INR, it has been decided to put in place an additional arrangement for invoicing, payment, and settlement of exports, imports in INR. Before putting in place this mechanism, AD banks shall require prior approval from the Foreign Exchange Department of Reserve Bank of India, Central Office at Mumbai.”

Vivek Srivastava, chief general manager of RBI, has stated in the circular that all exports and imports under this arrangement may be denominated and invoiced in Rupee (INR) and exchange rate between the currencies of the two trading partner countries may be market determined. The instructions will come into force with immediate effect and AD banks have been allowed by RBI to bring the contents of this circular to the notice of their constituents and customers concerned.