The agreements reached by the leaders of Russia and India at the highest level to reach new levels in bilateral trade, economic, scientific and technical cooperation are being successfully implemented.
D. Manturov’s working visit to India
During a working visit on November 11-12, 2024, Dmitry Manturov, First Deputy Prime Minister of the Russian Federation, participated in the 25th plenary session of the India-Russia Intergovernmental Commission on Trade, Economic, Scientific, Technical and Cultural Cooperation (IGC), which was co-chaired by Dmitry Manturov and Indian Foreign Minister S. Jaishankar.
On the eve of the meeting of the Intergovernmental Commission, the Russian guest was warmly received by Indian Prime Minister N. Modi, who noted the progressive and long-term nature of the multifaceted and large-scale cooperation between the two countries, emphasising the importance of constant and trusting dialogue with the Russian president. The Indian prime minister emphasised the need to further increase mutual trade, at the same time eliminating a significant imbalance in its structure in favour of Russia, primarily in connection with India’s sizeable purchases of Russian oil and petroleum products.
India is currently the world’s third largest consumer of oil and highly depends on importing it (85%). Despite the fact that India buys oil from many countries, Russia has been the largest supplier of crude oil for the second year in a row. The volume of oil supplied from Russia to India has been constantly increasing over the past two years and is now 1.88 million barrels per day. Currently, India accounts for a third of Russia’s oil exports. There has been a significant increase in oil exports to India, from 2-4 million tonnes in 2022 to 50 million tonnes in 2024. This led to a sharp increase in trade turnover between the two countries, from $10 billion to $65 billion, and the emergence of a negative balance for India, which is the reason for its serious concern.
The progressive and long-term nature of the multifaceted and large-scale cooperation between the two countries
These and other pressing issues in Russian-Indian trade and economic relations were the focus of a major business forum held in Mumbai on November 11, with the participation of leading business circles of the two countries. The IGC co-chairs, D. V. Manturov and S. Jaishankar, addressed the participants of this event. Noting the record volumes of bilateral trade, the latter also expressed the need to balance it by increasing Indian exports to Russia, the volume of which currently does not exceed 4-5 billion dollars. It is clear that such a large imbalance in mutual trade does not suit India; it persistently proposes to increase and expand the range of goods supplied to Russia. It is positive to note that the business forum convincingly demonstrated the great interest of the two countries’ business circles in further growth of trade, economic, investment and other areas of mutually beneficial ties.
All of these, as well as other topical issues of bilateral trade, economic, scientific, technical and cultural cooperation, were discussed in detail during the plenary session of the Intergovernmental Commission held on November 12, following which a lengthy protocol was signed, the goals and objectives of which encompass future cooperation in a variety of spheres. It was noted with satisfaction that over the past 5 years, the volume of mutual trade has increased more than 5 times and currently exceeds $60 billion. The tasks of further expanding the product range and reducing the imbalance in trade in favour of Russia will be fixed in the programme for the development of bilateral economic cooperation until 2030, which will aim to bring trade turnover and mutual investments to $100 billion by this time. The parties confirmed their intentions to conclude a free trade agreement between the EAEU and India, as well as bilateral documents on long-term supplies of oil, liquefied natural gas, services and investments. It was agreed to further strengthen the interaction of banking structures and to carry out mutual settlements in national and alternative currencies, which already account for about 90% settlements.
Special attention was paid to the need to diversify the structure of mutual trade and to increase the share of non-primary, high-tech products. The volume of Russian non-primary and non-energy exports to India is expected to reach $8 billion by 2030 (today this figure is about $3 billion). In addition to traditional supplies of oil, coal and mineral fertilisers, Russia will increase food supplies to India, primarily sunflower and soybean oil. In turn, Russia, along with purchases of agricultural products and medicines in India, intends to import industrial equipment and components, as well as technology.
Russia and India have industrial potential and investment resources
Russia allows for an expansion of exports of equipment for the Indian manned space programme and does not rule out Russian-Indian cooperation on projects to build new Russian space stations.
They agreed to continue their successful cooperation in the fields of energy, construction of the next units of the Kudankulam NPP, aviation and engine building, microelectronics, chemistry, metallurgy, digital technologies, railway engineering, as well as in the nuclear and space exploration fields. It was stated that Russia and India have the industrial potential and investment resources to enter the markets of third countries with joint products. A number of other specific agreements were reached on diversifying and expanding the range of goods supplied, balancing trade flows and increasing the share of non-primary, high-tech products. Future ways of expanding cooperation in the fields of education and culture were also outlined.
In general, the results of the IGC meeting show the mutual interest of the parties in expanding trade, economic, investment and other mutually beneficial cooperation. It is significant that India is second after China among all of Russia’s foreign economic partners.
The results of the visit of Russian First Deputy Prime Minister D. V. Manturov to India and his meetings with N. Modi and S. Jaishankar once again confirmed that India is a reliable and proven partner for Russia, a global power in the international arena.
The work of the Intergovernmental Commission does not cover the sphere of military-technical cooperation between the two countries. Another intergovernmental commission, co-chaired by the defence ministers of Russia and India, is responsible for these issues. A meeting within its framework is next in line.
Anvar Azimov, Ambassador Extraordinary and Plenipotentiary, Senior Scientific Researcher at the Moscow State University of Foreign Affairs (MGIMO), exclusively for the online magazine «New Eastern Outlook»
