India Russia News: Russian consumer companies turn to India as western brands pull the plug

Russia’s e-commerce platforms Ozon and Yandex Market, food supplements firm Pharmstandard, dental products distributor Simkodent, largest food retailer X5 Retail Group and confectionery major UNICONF are among several Russian companies that have reached out to India for business ties amid Moscow’s conflict with Kyiv.

Due to the conflict and the sanctions on Russia, many European and American brands have stopped supplying their goods including consumer electronics, and apparel to that country.

“Many Russian companies have approached as they have great interest to do business with India but there is apprehension on both sides especially about payment,” said an official.

Yandex Market, involved in imports, logistics, customs clearance, storage and distribution of goods, is exploring the possibilities of sourcing apparel and fashion, kids toys, bed linen, home decor, textile fabrics, consumer electronics, kitchen items, tea and leather products from India, according to an industry source.

“Yandex Market is exploring different opportunities of global sourcing from the very beginning of 2022,” the company replied to an email query from ET.

“Currently, we are continuing to focus on that stream, aiming to supply Yandex Market clients with a unique assortment and open the Russian market for brands from all over the world, including goods from India,” it added.

Food retailer X5 told ET that it is interested in expanding its cooperation with Indian suppliers of drinks, seafood, tea, coffee, chicory, rice, canned food, kitchenware, and fresh grapes, among others.

“X5 Group’s representatives will visit India in the last week of April, currently we are planning stages of an event,” an X5 Group representative said in an email reply.

At the moment, X5 purchases goods in more than 60 countries around the world.

“Currently, India is one of the top 20 countries in terms of X5 Group’s import volumes. In the near future, we plan to increase supply of Indian goods which are economically beneficial for imports,” the representative said.

The commerce and industry ministry had earlier sought details of all exporters whose payments are held up in Russia, the non-tariff barriers and market access issues they face there and the items which they want to export to Russia.

Indian exporters have received around half or $200 million of payments that were pending since last month in Russia.

As per another official, e-commerce major Ozon has expressed interest in branding of Indian products on its platform. The firm advertises products offered by traders on its platform and charges a commission when a transaction takes place between the foreign seller and the end customer.

“UNICONF has expressed interest in certain agricultural products,” said an industry representative.

UNICONF or United Confectioners is the largest confectionery holding company in Eastern Europe and leader of the Russian confectionery market.

“At least five companies in the pharmaceuticals, medical devices and equipment space are enquiring about the supplies from India,” said another industry representative, adding that some of them need assistance in getting suppliers of some particular pharmaceuticals while others want to distribute them.

Emails sent to other companies remained unanswered.

A textile industry source said that a buyer in Moscow has shown interest in buying polyester yarn from India and reducing its dependence on its current suppliers in Germany, China, Turkey and Italy.