Trade & Economic cooperation
Development of trade, economic and investment cooperation between Russia and India remains one of the key priorities in further promoting special and privileged strategic partnership between our two countries as well as increasing the bilateral trade up to 30 billion US dollars by 2025.
The main mechanism of enhancing Russia-India ties in this field is Russia-India Inter-Governmental Commission on Trade, Economic, Scientific, Technological and Cultural Cooperation (the 23rd meeting took place in Moscow on September 14, 2018, co-chaired of Deputy Chairman of the Government of the Russian Federation Mr Yuri Borisov and the Minister of External Affairs of the Republic of India Smt Sushma Swaraj).
Working groups and sub-groups are constantly engaged in practical activities in order to implement the list of bilateral projects as well as to find new promising areas of cooperation.
The Ministry of Economic Development of the Russian Federation and the Ministry of Commerce and Industry, Government of India, have established a permanent mechanism aimed at eliminating trade, economic and investment barriers. The launching of the Russian Export Centre in India, which is to support Russian small and medium enterprises, has entered its final phase.
According to the Russian Federal Customs Service, 2017 saw the bilateral trade reaching 9.36 billion USD with increase of 21.4% as compared to 2016.
The Russian export amounts to 6.45 billion USD (+21.5%), import – 2.91 billion USD (+21%). From January to October 2018, Russia-India trade increased by 17% as compared to the relevant period in 2017 and amounted to 8,5 billion USD with Russian export having risen by 21,1% (5,9 billion USD), import – by 8,7% (2,6 billion USD). Russian export to India mostly consists of machinery and technical production, products of chemical industry, gems, mineral fuel, metals and
Indian import includes mostly products of chemical industry, food and agricultural stuff, machines, equipment and vehicles, textile products, metals, pharmaceuticals. Russia makes up 1.13% of India’s foreign trade.
The two countries continue working to further liberalize customs regime within the “Green Corridor” project and put into operation the International North-South Transport Corridor in order to stimulate bilateral trade.
Atomic energy is the major track of Russia-India economic cooperation. Construction of the 3 and 4 blocks of NPP Kudankulam is ahead of schedule. The Protocol on the Russian state export credit for building the 5 and 6 blocks of NPP Kudankulam has come into effect.
Bilateral cooperation in oil and gas is gradually developing. In 2017, Rosneft along with the international consortium of investors struck a deal on buying 98% of Indian oil company Essar Oil’s Ltd shares amounting to 12,9 billion USD.
In June 2018, Russia started supplying liquefied natural gas (LNG) to India within
the long-term contract between Gazprom and GAIL stipulating the annual LNG supply of 2,5 million tons during the next 25 years with the opportunity to increase the volume up to 3,5 million tons. Indian public companies bought 49,9% of Vankorneft shares, one of the Rosneft largest oil enterprises.
In October 2016, Oil India Limited, Indian Oil Corporation Limited and Bharat Petroresources closed a deal on buying 29,9% of Taas-Yuryah Neftegazdobycha Ltd. Since 2001, ONGC Videsh Limited has been possessing 20% of “Sakhalin-1” shares.
In December 2017, Tata Power Ltd affiliated company FINR Ltd. gained the right to exploit Krutogorovskoe deposits for studying, exploring and producing coal during the next 25 years. Butyl rubber production factory with annual capacity of
120 thousand tons is entering the final construction stage in Jamnagar, Gujarat within the agreement between Russia’s Sibur Holding and Reliance Industries Ltd.
In April 2017, RUSAL and Runaya Metsource LLP signed an agreement on establishing a joint enterprise in India producing high-tech aluminum pastes and powders of wide application.
In September 2017, Indian company KGK DV, the resident of the free port of Vladivostok, launched a diamond cutting enterprise in the Far East with investments amounting to 0,5 billion rubles.
Russia-India interregional ties are vigorously developing holding considerable potential in terms of enhancing bilateral trade and investment. Russian companies make sustained efforts to find new opportunities for joint projects in high technologies, aircraft building, automobile industry, metallurgy, pharmaceuticals, and chemical industry, which can also be implemented within the “Make in India” program.
The parties are increasingly interested in investment and economic forums organized in both countries such as Saint Petersburg International Economic Forum, Eastern Economic Forum, and Vibrant Gujarat.