Under new regulations restricting imports from countries it shares land borders with, Indian state refineries have stopped buying crude oil from Chinese companies, as per sources quoted by a Reuters report.
State refineries have begun inserting a clause in their import tenders on new rules restricting dealings with companies from countries with a land border, as per the report. While the government order doesn't mention the name of the countries, India shares a border with China, Pakistan, Bangladesh, Myanmar, Nepal, and Bhutan.
In order to curb non-essential imports from China, the Indian Ministry of Commerce and Industry raised duties on 23 June. As per the sources, Indian state refiners have decided to stop sending crude import tenders to Chinese trading firms like CNOOC Ltd, Unipec, and PetroChina, among others.
From rejecting the Regional Comprehensive Economic Partnership (RCEP) secretariat's offer to join the trade bloc unconditionally, India has also extended the anti-dumping duty (ADD) to the imports of several items from China, including Pyrazolone, Chlorinated Polyvinyl Chloride Resin (CPVC), and digital offset printing plates.
As per the Reuters sources, Indian state refiners — controlling 60% of India’s 5 million barrel-per-day refining capacity — are not dealing with China Aviation Oil (Singapore), PetroChina, and subsidiaries of Unipec for fuel imports.
"Indian state refiners have also decided not to deal with China Aviation Oil (Singapore), PetroChina, and subsidiaries of Unipec among others for fuel imports, and have stopped chartering Chinese tankers for imports", the sources said. India is the world’s third biggest oil consumer and imports nearly 84% of its oil needs.
Sunjoy Joshi, an energy expert at Indian think tank Observer Research Foundation, says Indian state refineries don't import crude from Chinese oil companies, but from Chinese trading companies and they have now decided to not enter into contracts with them.
India and China have been engaged in a border standoff since April and New Delhi has resorted to imposing high tariffs and duties to curb imports from China as a retaliatory action to the conflict in the Himalayas.