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Increasing Cooperation in India- Russia Relations
Context:
India’s diplomatic engagement with Russia witnessed a significant revival in 2024, marked by Prime Minister Narendra Modi’s two visits to Moscow and President Vladimir Putin’s upcoming visit to New Delhi for the 23rd annual India-Russia summit.
Agenda for Modi-Putin Discussions
- Trade Expansion: Strengthening economic cooperation in areas like the Russian Far East, the Arctic, and the Chennai-Vladivostok corridor.
- Sanctions-Proofing Trade: Developing mechanisms to circumvent the impact of Western sanctions on bilateral trade.
- Defence Collaboration: Addressing delays in military supplies and exploring new areas for cooperation.
- Humanitarian Concerns: Repatriating Indian nationals coerced into contracts with the Russian army.
- Conflict Resolution: Discussing potential pathways to end the Russia-Ukraine conflict.
Strategic Implications of the Modi-Putin Engagement
- For Moscow, the visit underscores its ability to maintain strong ties with a major global power despite Western efforts at diplomatic isolation.
- For India, engaging with Russia reinforces its commitment to a multipolar world order and strategic autonomy. This approach allows New Delhi to balance relations with major powers, ensuring its interests are not subordinated to any single bloc.
Dimensions of India-Russia Relations
- Economic Cooperation: A Growing Partnership
- Enhanced Bilateral Trade
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- Despite Western sanctions isolating Russia from global markets, India-Russia economic ties have flourished. Bilateral trade surged from $12 billion before the Ukraine conflict to $65 billion in 2023, making India Russia’s second-largest trading partner.
- A key driver has been India’s increasing imports of Russian crude oil, while Indian exports of consumer electronics, machinery, and mechanical appliances have risen significantly.
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- Measures to Facilitate Economic Engagement
- To address payment challenges, the Reserve Bank of India authorised Russian entities to open special Vostro accounts in Indian banks. This mechanism has streamlined financial transactions and mitigated the impact of sanctions.
- However, challenges persist, including India’s refusal to purchase LNG from sanctioned projects and restrictions on Russian oil imports due to price caps imposed by Western sanctions.
- Challenges in Economic Ties: Western sanctions have also impacted Indian companies operating in Russia, with firms like Infosys exiting the market and conglomerates like Tata Group scaling back operations.
- Measures to Facilitate Economic Engagement
- Military-Technical Partnership: A Declining Pillar
- Shifting Defence Dynamics
India’s Defence Reliance on Russia: Resilient Despite Challenges
- Despite declining imports, Russia remains a crucial supplier for India’s armed forces. Key platforms include T-72 and T-90 tanks, SU-30 MKI and MiG-29 fighter jets, and Akula-class submarines.
- Recent procurements, such as the AK-203 rifles and the potential acquisition of the Voronezh radar system, highlight the enduring relevance of Russian defence technology. Russia’s willingness to transfer technology and offer cost-effective solutions further strengthens this partnership.
- The defence relationship, long a cornerstone of India-Russia ties, has seen a decline. Russia’s share in India’s defence imports fell from 76% in 2009 to 36% in 2023.
- India’s diversification strategy has led to increased procurements from Western nations such as the United States and France, driven by the need to counter Chinese aggression in the Himalayas and the Indian Ocean.
- Impact of Russia’s Focus on Ukraine
- The Ukraine conflict has strained Russia’s military-industrial capacity, delaying the delivery of critical platforms like the S-400 missile defence system and spare parts for existing equipment in India’s arsenal.
Geopolitical Reasons Impacting India- Russia Relations
- The Russia-China Equation
- Russia’s deepening ties with China have raised concerns in New Delhi. Beijing’s status as Moscow’s largest trading partner and increased military cooperation, including joint exercises and the purchase of advanced systems like the S-400, underscore the growing strategic alignment between the two nations.
- Fallout from the Russia-Ukraine Conflict
- India’s neutrality on the Russia-Ukraine conflict has drawn significant criticism from Western nations. New Delhi abstained from condemning Moscow’s invasion and refrained from participating in international sanctions.
- Western Misinterpretations of India-Russia Relations
- Western analysts often overestimate India’s role in bolstering the Russian economy through energy purchases and trade. Calls for secondary sanctions against Indian entities ignore New Delhi’s nuanced policy of balancing its strategic interests.
- India’s engagement with Russia is not indicative of disinterest in Western partnerships but a reflection of its long-standing policy of non-alignment.
