Russia-India relations and economic deals

Russia to boost non-oil exports to India – Moscow, 11.11.2024.

First Deputy Prime Minister Denis Manturov is visiting New Delhi for talks on expanding economic cooperation.

Russia plans to increase non-resource, non-energy exports to India to $8 billion by 2030, First Deputy Prime Minister Denis Manturov told reporters on Monday. Manturov is in India on an official visit as co-chair of a Russian-Indian commission on trade, economic, scientific, technical and cultural cooperation, which is set to meet on Tuesday.

“We have plans to boost Russian non-resource, non-energy exports to India. In 2023, the volume of industrial exports reached $3.2 billion, and we aim to grow this to $8 billion by 2030,” Manturov revealed, as cited by TASS.

Addressing an Indo-Russian business forum in Mumbai, the minister noted the progress in diversifying trade between the two nations – an issue both New Delhi and Moscow have acknowledged and have pledged to resolve in order to make long-term economic cooperation more sustainable.

Manturov stressed the importance of developing new logistics routes connecting Russia and India, including the North-South transport corridor (INSTC) running via Iran, as well as the Northern Sea Route and shipments between Vladivostok in Russia’s Far East to Chennai on the southeast coast of India. “The potential for further reducing logistics costs also lies in increasing supply intensity. The more cargo there is, the more efficient and cheaper logistics would become,” Manturov noted.

India has become Russia’s second largest importer of crude oil in the past two years. Russia is also interested in facilitating long-term supplies of LNG and coal to India, Manturov, noted. “Russian coal mining enterprises have significant resources and are interested in expanding their presence in the rapidly growing Indian market,” he added.

The deputy prime minister underscored the potential of exporting goods and services jointly produced by Russian and Indian companies in the South Asian nation to third markets, adding that the two countries have “all the necessary resources” to enable this, including “industrial and technological potential, investment resources, and logistics infrastructure.” The targeted markets include the Middle East, Africa, South Asia, and Southeast Asia, Manturov said. “We can leverage the competitive advantages of our countries not only for exporting jointly developed products to new markets but also for implementing [joint] investment projects,” he added.

Indian Foreign Minister S. Jaishankar, who addressed the forum alongside Manturov, underscored that the two countries have “many new avenues” for expanding cooperation and that bilateral trade, which reached $66 billion last year, can easily reach a target of $100 billion by 2030. The goal was set by Russian President Vladimir Putin and Indian Prime Minister Narendra Modi during their bilateral summit in Moscow in July this year.

To facilitate more interactions between businesses of the two countries, the Russian Business Council for Cooperation with India is opening an office in New Delhi that will be instrumental in helping Indian companies access the Russian market, Sergey Cheremin, minister of government and head of the Department of Foreign Economic and International Relations of Moscow, announced on Monday. According to Cheremin, the office will include a permanent exhibition of Russian products and technologies, a consulting centre for companies from both countries, and a recruitment agency for hiring workers for various sectors.

https://www.rt.com/india/607462-russia-india-non-oil-exports/

90% of Russia-India trade conducted in national and alternative currencies – Moscow, 11.12.2024.

The two countries have agreed on steps to diversify economic cooperation and deal with a trade imbalance.

The share of national and alternative currencies in trade between Russia and India has reached almost 90%, Russian First Deputy Prime Minister Denis Manturov said in New Delhi on Tuesday. Over the past five years, bilateral trade between the two countries has grown more than fivefold, making India Moscow's second largest trade partner, the minister added.

Manturov is visiting India to co-chair the 25th meeting of the Intergovernmental Russian-Indian Commission on Trade, Economic, Scientific, Technical, and Cultural Cooperation, along with Indian Foreign Minister S. Jaishankar.  

Addressing the topic of cross-border payments, the Russian deputy prime minister emphasized that the issue is being closely monitored. Bilateral trade has been impacted since 2022, when Russia was hit by US-led sanctions, and many Russian banks were cut off from SWIFT, Visa, and MasterCard, prompting Russia and its major trading partners to use alternative mechanisms to settle trade.

“The share of national and alternative currencies in bilateral trade is growing – it has already reached 90%. We believe it is necessary to continue working on expanding correspondent relations between Russian and Indian banks,” Manturov said.

While lauding the constantly expanding trade and economic cooperation that “benefits from the trust and confidence built” over the years, both sides acknowledged that certain issues remain unresolved. This includes a large trade imbalance driven by India’s rapid increase in purchases of crude oil from Russia. While imports from Russia last year stood at $61.1 billion, Indian exports were just $4.2 billion.

“Our goal is to ensure that trade is more balanced, which will require addressing current constraints and undertaking facilitative efforts,” Jaishankar said on Tuesday. At the same time, he noted the importance of Russia as a reliable supplier of crude oil, coal, uranium, and fertilizers to India, ensuring its energy and food security. Manturov also emphasized the importance of diversifying trade.

“We have already increased agricultural exports to India, primarily sunflower and soybean oil. Russia, aside from purchasing products of the agro-industrial complex from India, also imports industrial equipment, components, pharmaceutical drugs, and substances,” the Russian minister said. He stated that Moscow is “strongly committed” to signing a trade pact between India and the Eurasian Economic Union (EAEU), as well as a bilateral agreement on protecting investments. “This fully meets the needs of our business community,” he noted.

Jaishankar stressed that efforts towards more balanced trade should include progress in the negotiations for the free trade pact between India and the EAEU, comprising Armenia, Belarus, Kazakhstan, Kyrgyzstan, and Russia. The idea of such a deal was initially proposed in 2013 and discussions were held in 2017, although no further progress was made. The talks for a free trade pact were restarted in March of this year.  

Improving connectivity between the two countries was also named as one of the priorities. The majority of goods are transported between the two countries via the Suez Canal. However, given the disruption of global logistics and supply chains due to Western sanctions against Russia, Moscow and New Delhi have been actively developing alternative routes.

This includes the North-South Transportation Corridor (INSTC) – a 7,200km-long route connecting India to Russia and Europe, Central Asia, and Afghanistan via Iran – the Vladivostok-Chennai corridor that connects India’s southeastern coast with Russia’s Far East, and the Northern Sea Route (NSR) that passes along Russia’s northern coastline through the Arctic Ocean and is considered the  shortest shipping route between the western part of Eurasia and the Asia-Pacific region.

https://www.rt.com/india/607526-russia-india-trade-national-currency/