Russian Companies Pivot to Global South Amid Sanctions

Russian companies, led by VTB and CEO Andrei Kostin, are pursuing growth in the Global South despite Western sanctions. VTB supports oil deals and aims for expansion in India. Russia's oil remains sought-after, though sanctions complicate trade. Kostin emphasizes the strategic pivot from Western markets to emerging opportunities.

Russian companies are setting their sights on expansion into the Global South as they continue to adapt to Western sanctions. This was revealed by Andrei Kostin, CEO of VTB, Russia's second-largest bank, in an interview with Reuters. Despite sanctions impacting major oil firms Rosneft and Lukoil, interest in growth opportunities remains strong.

Kostin noted a shift towards raw material processing in countries like China, with VTB involved in significant foreign acquisitions, such as the 2017 purchase of India's Essar Oil by a Rosneft-led consortium. This strategic pivot aims to capitalize on domestic markets without export plans, as seen with Nayara Energy's operations in India.

The future of Russian oil operations in India, a major buyer of discounted oil, hinges on ongoing diplomatic relations and trade dynamics. While sanctions pose challenges, Kostin remains confident in demand for Russian oil, with plans for VTB to expand further in India, potentially boosting machinery and pharmaceutical exports to Russia.

(With inputs from agencies.)