India has revamped its energy diplomacy strategy, focusing on four key pillars: supplier diversification, connectivity investment, financial engineering, and energy-transition diplomacy, as per a recent report. This shift aims to maintain strategic autonomy and competitive pricing tension among suppliers. The report highlights India’s ability to expand energy ties with Russia while improving relations with the US, showcasing modern geopolitical influence.
The report contrasts India’s approach with Europe’s, emphasizing how India maintains ties with sanctioned suppliers like Russia while deepening partnerships with Gulf monarchies. By sourcing crude and gas from over 40 countries, India avoids dependence on any single power, thus denying leverage of indispensability. India’s emphasis on connectivity projects like the INSTC and IMEC aims to diversify trade routes beyond the Strait of Hormuz.
In addition, India is focusing on financial diversification by reducing dollar dependence and introducing a rupee-rouble settlement pathway for large commodity trades. Despite strong economic ties with the US, India is willing to invest in SWIFT bypass infrastructure, raising the cost of financial coercion for Washington. The country has also significantly increased its non-fossil installed capacity, reaching 283.46 GW by March 2026, marking a threefold increase since 2014.
The report recommends that India formalize a Chabahar sanctions carve-out within the evolving US-India trade framework to enhance Indo-Pacific connectivity. It suggests expanding strategic petroleum reserves, developing a multi-currency Gulf energy settlement framework, and introducing formal demand mandates for green hydrogen procurement by public sector consumers.
