Reliance Counters China Curbs and Sanctions with Global Supply Chain Shifts

Indian billionaire Mukesh Ambani's Reliance Industries Ltd. is navigating dual challenges in its energy and technology supply chains, with recent moves highlighting its reliance on global markets amid geopolitical and regulatory shifts. The company has accelerated the export of battery components from China, rushing to ship battery equipment ahead of new export curbs, while simultaneously snapping up Mideast oil and ramping up crude oil purchases from the Middle East and the U.S. to offset disruptions caused by Western sanctions on Russian producers.

Reliance's battery operations, a cornerstone of its push into renewable energy storage, face immediate hurdles as Beijing tightens control over the export of critical battery supply chain equipment. Chinese authorities introduced rules this month requiring companies to secure licenses for such exports, effective Nov. 8, the Business Standard report said. A team from Reliance has traveled to China to expedite shipments, with sources indicating that at least a dozen other foreign customers are similarly expediting orders, sometimes bypassing quality checks to meet deadlines, the report added. Without timely access to Chinese equipment, Reliance risks delays in its plans to locally assemble batteries for its solar energy projects, a key initiative under India's energy independence strategy, the Business Standard piece noted.

Simultaneously, Reliance has pivoted its crude oil sourcing strategy in response to U.S. sanctions on Russian producers Rosneft and Lukoil. The company has purchased millions of barrels of Middle Eastern and U.S. crude, including grades like Saudi Khafji, Iraqi Basrah Medium, and Qatari Al-Shaheen, with deliveries expected in December and January, a Caliber report notes. Traders note that Reliance's spot market activity this month has been unusually aggressive, with at least 10 million barrels acquired, most post-sanctions, Bloomberg reported. The refiner, which previously sourced Russian crude via long-term contracts, is now emphasizing a diversified supply strategy to mitigate risks from regulatory volatility, the Bloomberg piece added.

The interplay of these moves underscores Reliance's balancing act between technological ambition and geopolitical realities. China's dominance in the battery sector—six of the top ten global producers are based there—has left companies like Reliance vulnerable to export policy shifts, the Business Standard report warned. Meanwhile, the Russian oil sanctions have forced a rapid recalibration of energy procurement, with Indian refiners broadly increasing spot purchases from the Middle East, the U.S., and Brazil, Bloomberg reported.

Reliance's spokesperson acknowledged the evolving landscape, stating that the company is "assessing the implications of sanctions on Russian oil flows and the export of refined products to Europe," while reaffirming its commitment to maintaining operational reliability through diversified sourcing, Bloomberg added.

As global supply chains become increasingly entangled in trade conflicts, Reliance's strategies reflect broader industry concerns about overreliance on single suppliers. Chinese battery makers have assured clients that export licenses will be granted smoothly under the new regime, but the interim uncertainty has forced companies to adopt a cautious, reactive posture, the Business Standard report said.