Ukraine declares India’s firm Birla Group international sponsor of war

19 May, 04:47 PM
Another subsidiary of the Birla group, cement maker Ultratech, has already been in the sanctions news (Photo:REUTERS/Dado Ruvic)

Another subsidiary of the Birla group, cement maker Ultratech, has already been in the sanctions news (Photo:REUTERS/Dado Ruvic)

The National Agency on Corruption Prevention (NAZK) has added Indian company CK Birla Group to its list of international sponsors of war, the agency’s press service announced on May 19.

According to NAZK, Birla Group, and its subsidiary, National Engineering Industries Limited, Qualify for the list due to Birla Group’s sales of bearings to the Russian military-industrial complex, helping the Russian military substitute critical Western goods in their supply chains.

Bearings are critical part for many types of equipment: tanks, other armored and tracked vehicles, and aircraft. In addition, bearings are essential for the functioning of the railroad, the main method of transport for Russian logistics. Despite the apparent simplicity of this part, Russians are unable to produce bearings of sufficient quality and in sufficient quantity, NAZK said. In 2020 alone, Russia imported $419 million worth of bearings. 55% of this volume came from Europe and North America, and primarily from Germany - 16%.

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After Russia's large-scale invasion of Ukraine, European and American bearing manufacturers left the Russian market. Due to the lack of these parts, Uralvagonzavod and Omsktransmash, the main tank-building and tank-repair enterprises of the Russian Federation, completely shut down. Significant problems arose in the design of airplanes, ships, and train maintenance.

CK Birla Group and its NBC Bearings brand, stepped in to fill the gap left by the exit of Western firms, NAZK says. According to customs data, for the period from April 2022 to March 2023, NBC Bearings' share in the import of bearings from India to Russia was 38.4%, totaling $12.3 million. The main buyer in Russia was the European Bearing Corporation group of companies, a Russian industrial conglomerate whose products are actively used in the manufacture of locomotives, aircraft, missile systems and other military equipment.

"We call on this company and other manufacturers of dual-use goods to refuse to supply products to the terrorist state of Russia," said NACP head Oleksandr Novikov.

“You can still avoid becoming a cog, or rather a bearing, in Putin's military machine. It's never too late to give up this bloody profit.”

Another subsidiary of CK Birla Group, cement producer Ultratech, has already been sanctioned for purchasing coal from Russia's SUEK for yuan to circumvent dollar sanctions. All these facts confirm the company's support and sponsorship of Russian terrorism, NAZK stressed.

Earlier, the NAZK designated the following companies international sponsors of war: Procter & Gamble, OpenWay Group, Danieli, TMS Tankers Ltd, Dynacom Tankers Management Ltd., Leroy Merlin, ComNav Technology, Mondi Group/Mondi PLC, eKassir, Liberian International Ship & Corporate Registry, Bonduelle, Auchan Holding, Metro Cash & Carry, Buzzi Unicem, Yves Rocher, Xiaomi, and OTP Bank.

Inclusion in the list of international sponsors of war adds the company to the World-Check database, which keeps track of high-risk individuals and organizations and is used worldwide to identify and manage financial, regulatory and reputational risks. Interaction with the World-Check database is intended to protect the international financial sector from the sponsors of the Russian war effort, cooperation with whom can be damaging for socially responsible businesses.

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