India-Russia trade stands at $45 bn, will continue to grow: EAM

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External Affairs Minister S Jaishankar on Monday said that bilateral trade with Russia has crossed USD 30 billion much before the target year of 2025, and the trade actually stands at USD 45 billion, with it poised to grow.

Addressing the India-Russia Business Dialogue, along with Russian Deputy PM Denis Manturov, EAM Jaishankar said that in the past decade the two sides have witnessed enhanced levels of cooperation in many areas, which include energy, science & technology, inter-regional cooperation. These areas supplement the traditional areas of defence, nuclear and space.

He said the two sides have been discussing how to expand and diversify their bilateral trade and economic cooperation. “…Now, we have crossed the bilateral trade target of USD 30 billion before the year 2025, which was the target year given to us by our leaderships. And infact, for the period April, 2022 – February, 2023, I understand that the trade is actually about USD 45 billion and the expectation is that this will continue to grow.”

He said there is “understandable concern” about the trade imbalance which these new volumes have created, and both need to work together on how to address them – whether they are market access impediments, or Non Tariff barriers, or related to payments and logistics.

He said that both sides need to be honest about the short and medium term challenges that they face. “..So, I would say what really the future of our economic cooperation requires, is the willingness, the ability to really look at it from the point of view of the other party and then come up with solutions which will overcome the obstacles.”

“Apart from the traditional exports of pharmaceuticals and organic chemicals, clearly there are possibilities in auto and spare parts, electronics goods and components, medical devices for which there was a speaker; on high efficiency solar PV modules, textile & apparel, white goods, leather, ceramics, but also I would emphasize food and agricultural products; because this is one area where SPS restrictions have been really going on,” EAM said.

Jaishankar said that talks are on for a Free Trade Agreement between India and the Eurasian Economic Union, which were interrupted due to Covid. India and Russia are in advanced negotiations on a new Bilateral Investment Treaty (BIT), he added.

On connectivity, he said the International North South Transport Corridor as well as the Eastern Maritime Corridor, which is the Chennai-Vladivostok Corridor, are being focused on. Jaishankar said the Eastern Maritime Corridor fits in with India’s goal of “Act East Policy”, as well as the Russian policy of having the Far East as an additional driver of the economy.

On the payments issue, he said both sides have held talks and “the expansion of the correspondent relationship network, under the scheme of International Trade Settlement in Indian Rupees through Special Rupee Vostro Account system. And I think the payments issue clearly needs to be worked through between our systems.”

Obliquely referring to the Ukraine conflict, EAM Jaishankar said that the India-Russia cooperation “is a subject of attention and comment, not because it has changed, but because it has not. Indeed, it has been among the steadiest of the major relationships of the world in the contemporary era. But that by itself is not enough. We share a commitment to a multi-polar world. And that also means a multi-polar Asia.

“Russia is today looking much more towards Asia, a reassessment from its traditional focus. For India, this could mean a broadening out of our engagement that was overly reliant on the triad of military, nuclear and space cooperation. For Russia also, it presents a broader set of options. As Russia looks eastwards, its resource and technology complementarity can be a powerful contribution to India’s growth. And this is a growth of a 3.5 trillion economy that is expected to grow at more than 7% for at least a decade or more. And I would say that our ties, our cooperation is best advanced through more intensive bilateral engagement such as the one that we are having today,” EAM added.

In a tweet, he said:

“Addressed the India-Russia Business Dialogue 2023 today. Thank Deputy PM Denis Manturov for joining me.

“A productive discussion on the opportunities and challenges in economic cooperation.

Look forward to the Inter-Governmental discussions tomorrow.”

Separately, National Security Advisor Ajit Doval met Denis Manturov, Deputy Prime Minister and Minister of Trade & Industry of the Russian Federation.

“Both sides discussed a range of bilateral issues to implement the India-Russia strategic partnership,” sources said.

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