By Rajeev Sharma
Barring a few years in the last decade of the last century, India and Russia have been having very close and special relationship for past over four decades. Since 2000, the revitalized Indo-Russian strategic partnership has gone from strength to strength, thanks mainly to the annual summits mechanism started by the two countries in that year.
Russia was the first country to have the institutionalized mechanism of annual summits with India in each other’s capitals alternately. For India, Russia remained the only country for almost six years to have this mechanism in place. In 2006 Japan too started the practice of annual summits with India.
Till now, Russia and Japan remain the only two countries with which India has an institutionalized mechanism of holding annual summits. Now Indonesia too has been added to this list after Prime Minister Manmohan Singh’s bilateral visit to Indonesia (October 11-12, 2013), though the vital difference is that the heads of two governments would not necessarily be traveling to each other’s capitals but using the opportunity of meeting each other at multilateral events at third venues.
Indo-Russian bilateral relationship is a corner stone of foreign policies of the two countries and this fact has been emphasized time and again by top leaders from both sides. The mind-boggling diversity in Indo-Russian engagement is rare in international politics. Their cooperation covers so many diverse fields as defence, energy, space, trade, investment, infrastructure, banking, pharmaceuticals, agriculture, science and technology, culture and in various world bodies and multilateral fora.
The intense and substantive engagement between India and Russia is set to get a fillip when the two sides hold their 14th annual summit in Moscow on October 21. Several bilateral agreements, many of them big ones, are expected to be signed during the 14th summit.
In fact, energy and defence are the two biggest success stories of Indo-Russian ties, though there are issues from both sides that demand early resolution. Let us have a quick sector-by-sector run down to get the latest picture of Indo-Russian relations.
Energy
Arguably the most promising sunrise sector in the Indo-Russian bilateral engagements today, the upcoming summit is likely to be dominated by various proposals from the two sides on energy cooperation. Kudankulam’s third and fourth units, Indian participation in Yamal and the TAPI pipeline are expected to figure prominently on the agenda when Manmohan Singh holds talks with Russian President Vladimir Putin.
The Turkmenistan-Afghanistan-Pakistan-India [TAPI] gas pipeline project achieved a major mile stone in July 2013 with the signing of the Contract on Sales and Purchase of the gas between Turkmenistan and Afghanistan. India is upbeat about the project and rightly views it as a game changer in energy security. India is eagerly looking forward to implementation of the project by 2017. The project will have huge diplomatic and strategic positives as it would be a first project to bring India and Pakistan together as stakeholders in the stability and security of Afghanistan and will act as a very practical and pragmatic tool for improving the India-Pakistan relationship itself.
Defence
Despite Russia losing out on several defence deals, Russia stays on top of the list of suppliers with $16 billion in orders. India’s defence imports amounted to $38 billion for the three-year period April 1, 2010 to March 31, 2013. Moreover, Russia’s current defence portfolio in India is worth $20 billion which is enough to keep the Russian arms industry busy for years.
Russia’s Ambassador to India Alexander Kadakin told Voice of Russia in an interview two months ago that the future of the defence relationship between the long-term allies is in the sharing of modern technologies and joint production. He downplayed Russia losing several Indian defence tenders but stressed the importance of the fact that Russia has been transferring modern technology to India like no other nation has been.
“Tenders are tenders, but no country in the world shares with India the most secret and confidential things that it possesses. Can you name another country, besides Russia, that would honestly hand technologies to India? There is no such country. This is the fundamental difference between our military-technical cooperation with India and its cooperation with other states,” Kadakin told VoR on August 14.
Trade
This is an area of concern for the two governments as the current bilateral Indo-Russian trade is pegged at $ 11 billion which is way below the potential considering the extremely close relations between the two sides. Both the sides, however, are optimistic of achieving the $ 20 billion trade target by 2015. India is Russia’s 18th largest trading partner and jumped 5 positions up last year.
Science and Technology
NIS GLONASS signed an agreement with India on October 11, 2013 to supply its personal tracking systems that could enhance the safety and security of women, children and old-aged people in the country. Besides, this will help both countries to deal with logistics, navigation and traffic and will also result in safe cities and ensure appropriate law and order. Initially, this system is going to be put in place in Delhi but in the near future India wants to use it all over the country for traffic management and other uses and for disaster management. This agreement will also open up avenues for India and Russia for setting up joint ventures in the field of technology like they produce together BrahMos missile. Incidentally, the two countries already have huge collaboration in avionics.
Information Technology
The IT sector is another key area where the two sides are engaged in deepening their cooperation. The Indian initiative in this regard is their proposal that the Indian software and the Russian hardware should be combined. The Russians are on board and it is a matter of time when this idea is translated into reality.
Pharmaceuticals
Russia is reshaping its pharmaceutical sector as part of the Pharma2020 concept which has named manufacturing of Indian generic drugs in the Moscow region as a priority of Russia-India cooperation. This promises to provide newer avenues for Indian drug manufacturers and exporters to expand their business in Russia. Incidentally, the Russian pharmaceutical market was pegged at $24.9 billion in 2012 and is expected to triple to $ 75 billion by 2020. This will be a golden opportunity for Indian companies to grow their business in Russia.
Banking
Over the last 5 years, Russian banks in India have largely been financing defence deals and energy projects over the last five years. This is set to change significantly as the Indo-Russian bilateral trade, likely to be injected with several stimulus packages and schemes by the two governments would open up other greener pastures for them. Currently three largest state-owned Russian banks are operating in India, including the JSC VTB Bank which was the first to open a representative office, which was subsequently converted into a branch in New Delhi. VTB is now considering extending its presence in India by opening branches in Mumbai, Chennai and Ahmedabad. Besides, another part of VTB financial group, investment bank VTB Capital is planning to enter India in near future. To support Russian companies coming to India, VTB is also pondering over the creation of an investment fund as entering any new market using only borrowed funds is difficult.
With so much at stake the fourteenth Annual Summit has all ingredients to make for a substantive and fruitful interaction between India and its steadfast friend and partner for over six decades.
(The views expressed above are the personal views of the author)
The writer is a New Delhi-based journalist-author and a strategic analyst who tweets @Kishkindha and can be reached at bhootnath004@yahoo.com.
