India's Reconnect With Russia

India has been a close ally of erstwhile Soviet Union since 1960’s and had an exceptional camaraderie. After the collapse of Soviet Union, Russia became time-tested partner of India. For the past five decades, Russia was the top most military weapons and equipment supplier of India. Bilateral relations between these countries are rooted in and strengthened by defence trade.  Irrespective of the change of leadership, bilateral ties with Russia remained very strong. With signing of “Declaration on the India- Russia Strategic Partnership” in 2000, the bilateral cooperation soon extended to politics, trade and economy, security, culture, science and technology. By 2010, the strategic partnership is elevated to Special and Privileged Strategic Partnership. The dialogue mechanism between India and Russian Federation is characterized by Annual Bilateral Summit Meetings which are held alternatively in India and Russia. Modi on his two-day upcoming visit to Russia will participate in the 16^th Annual Summit Meetings on Dec 23^rd. During the 15^th Annual Summit meet held in Delhi, on December 10^th 2014, Prime Minister Narendra Modi and President Vladimir Putin adopted a joint statement “Druzhba-Dosti”: A vision for strengthening Indian-Russian Partnership over the next decade.

Russia has been key pillar of India’s foreign policy. Besides, annual summit meeting at the highest level, two intergovernmental commissions- one on trade, economic, trade, scientific, technological and cultural cooperation (IRIGC-TEC) co-chaired by External Affairs Minister and the Russian Deputy Prime Minister (DPM) and another on Military Technical Cooperation (IRIGC-MTC) co- chaired by Defence Ministers of both countries meet annually. Foreign Ministers of both countries this year met along the sidelines of Russia-India-China (RIC) Foreign Ministers meet in Beijing this year. Months before Modi’s state visit to Russia, Foreign Affairs Minister Sushma Swaraj and Defence Minister Manohar Parrikar participated in the meetings and prepared the ground for Modi’s annual summit meet. Traditional bilateral ties so far were confined to defence, nuclear and heavy industry. With top aerospace companies keen on investing in India for manufacturing components for the civil and military programs in India, a high-powered Indian business delegates will travel to attend Indo-Russia CEO meet to deliberate at the prospect of forming joint venture (JV) companies. To boost up trade and investments Modi will address the Russian investors at the Moscow Expo Centre on Dec 24^th. About 300 Indian companies are registered in Russia whose cumulative investments account for $8 billion while Russian investments in India is about $4 billion. Last year Essar Oil has signed agreement with Rosenft Oil Company of Russia for a period of 10 years.

Trade Ties

Indo-Russian trade volume as of 2014 is $9.51 billion of which India’s exports which include pharmaceuticals, iron& steel, manufactured products, apparels, tea, coffee and tobacco  account of $3.17 billion and imports which majorly include diamonds, fertilisers, nuclear and defence equipment is $6.34 billion. Despite the long standing bilateral ties, the volume of trade is abysmally low. During the 15^th Indo-Russian Annual Summit countries have set a target of $30 billion by 2025. Besides, military ties, India and Russia are contemplating on exploring trade ties beyond energy, IT, diamonds and pharmacy. A $3 billion fund to promote startups in nanotechnology, aerospace, defence and manufacturing sectors. India is also seeking Russian investment in National Infrastructure Fund and keen in capitalizing Russian interest in India’s Make in India (MII). In a $1 billion worth project, India’s Hindustan Aeronautical Limited and Anil Amban’s Reliance Defence as local partners will team up with Russia to manufacture 200 Kamov-226T helicopters to replace aging Cheetah and Chetak helicopters used for ferrying supplies to Siachen glacier. Turkey recently gunned down Russian fighter jet on the charges of air space violations and infuriated Russia in retaliation pulled plug on its bilateral trade relations with Ankara and is looking towards its traditional partners for investment destinations. Modi during his visit is keen on filling the vacuum created by those sectorial sanctions. Deputy PM of Russia, Dmitry Rogozin who was in India few days back to prepare for Modi’s trip indicated that Russia now wants India to be its major trade and economic partner. Some Indian strategists opine that despite India’s shift towards the west for defence equipment, Russia has an edge over the west in several areas. Further, Russia having invested in India over several decades, well-versed with Indian bureaucracy can be a valuable partner in MII.

Energy Cooperation

 Another key aspect of Modi’s trip will be expanding nuclear energy cooperation. Russia is seeking India’s cooperation in building nuclear power plants in other third world countries, in the area of joint extraction of Uranium, production of nuclear fuel and atomic waste elimination. Russia might announce plans of setting up of six Advanced Light Water Reactors of 1200 (Megawatt) each in Andhra Pradesh. Modi’s astute oil diplomacy helped India’s ONGC Videsh to acquire 15% stake in Russia’s Vankor Field when Modi attended BRICS Summit at Ufa in July, 2015. During his upcoming Summit meetings Modi will finalize second overseas oil assets acquisition worth $1 billion towards 29% of Rosenft’s stakes in Siberian Oil Project by Oil India.

Defence Ties

The long standing cooperation in the defence field gradually evolved from seller-buyer relationship to collaborative joint research, development and production of advanced defence technology and systems. BrahMos Missile system, joint development of fifth generation air crafts and multi transport aircraft are the illustrious outcomes of such cooperation. But of late several lucrative Indian defence deals were clinched by Russia toppling it from the status of the top most defence equipment supplier of India. In an effort to mollify Russia, India has finalized purchase of five units of S-400 Triumf Air Defence Missile Technology worth $10 billion, capable of destroying incoming aircrafts, drones and missiles within a range of 400km. Defence Acquisition System (DAC) has also cleared decks for purchase of six regiments of Pinaka rocket system under MII, 571 light bullet proof vehicles for counter-insurgency operations, 120 trawls, 24 Pechora Air defense systems and an electronic warfare system deployed in mountainous areas for Indian Army. Last year India leased a sub-marine Admiral Gorshkov which is commissioned into Indian Navy as INS Vikramaditya. Defence cooperation has been a key aspect of Indo-Russian relations and both countries annually hold joint military exercises.

Other major aspects on the agenda include expediting the progress of the International North-South Transport Corridor (INSTC), up gradation of Chabahar port, finalization of India’s proposed membership to the Eurasian Economic Union (EEU), expanding cooperation in outer space research projects and maximizing opportunities in SCO (Shanghai Cooperation Organisation). This year marks 40^th anniversary of launch of India’s first satellite Aryabhatta on Russian launch vehicle Soyuz. According to some media reports, Modi may travel to Astrakhan, gateway to Caspian Sea from Moscow. During his stint as a Chief Minister of Gujarat, a MoU was signed between Gujarat state and Astrakhan region establishing cooperation in five areas- hydrocarbon research, ship-building, ship-breaking, revival of trade routes (between Okha port of Gujarat and Olya Port in Astrakhan region) and promotion of tourism. Sister-city relations are in vogue between Ahmedabad and Astrakhan City. Indian House in Astrakhan houses a library that has extensive reports of Gujarat traders traveling to this region rich in natural resources and establishing strong trading ties. Old chronicles indicated that Indian traders had even married local women and lived there. India and Russia are now exploring the possibility of creating broad counter terrorism coalition.

Over the past few years India’s marked economic surge, levitation towards the US and geopolitical prominence culminated in decline of Russia’s share in India’s defence trade. Meanwhile, following annexation of Crimea by Russia, Ukraine plunged into crisis and the west imposed economic sanctions on Moscow. In a double whammy for Russian economy, plummeting global oil prices to as low as less than $40 a barrel coupled by economic sanctions aggravated its financial crisis. With India’s defence acquisitions from Russia witnessing a steep fall, aggrieved Russia paid mere lip service to India’s candidature for UNSC and chose to join China and Pakistan in undermining the G-4 initiative at the UN General Assembly. Distressed by the prospect of recession and increased western alienation Russia is pushed into China’s embrace. Joint military exercises with China in the Mediterranean region testimonies changing geopolitical equations of Asia. Despite the violation of the copyrights and reverse engineering of Russian defence equipment supplied to China and reneging on the prodigious $400 billion oil and natural gas contract for a period of 30 years, Russia is sticking to China. In 2012, China acquired Russian Su-27 flanker jets and reverse engineered them into J-11B aircraft.  In partnership with China, Russia is now entering into crucial Afghanistan- Pakistan regions and Central Asia. Intriguingly, Russian strategists are now increasing viewing Pakistan as South Asian gate keeper and following visits by General Kayani in 2012, there is a conceivable Russian policy shift towards Islamabad. This was followed by an agreement wherein Russia supplied RD 93 engines for JF 17 fighters assembled in Pakistan in collaboration with China. Recently, General Raheel Sharif on his visit to Russia signed an agreement for sale of advanced Sukhoi 35 fighters and MI 35 attack helicopters. Ironically Russia in its joint statement with India in 2003 condemned Pakistan for patronizing terror outfits on its territory is now alarmingly quiet and soft towards Islamabad. In fact it later emerged that having lost the lucrative Indian helicopter deals and combat aircrafts to the US and France respectively, Russia out of desperation have reached out to Pakistan.

With India pandering to the US by signing 123 agreement, Russia is now flirting with Pakistan and China to enliven its grand stratagem of creating a Eurasian Union. Ever since Russia’s aggressive air strikes against the ISIS on September 30^th, 2015 geopolitics experienced a major shift.  Economic sanctions, plunging oil prices, Syrian attacks have seriously crippled Russian economy, compelling it to seek refuge in China. But Russia is a junior partner with China and is wary of its historical disappointments with Beijing wherein Mao had out rightly dumped Russia to embrace US.  Russia’s overtures with Pakistan is borne largely out of its “compulsive” need to sell military weapons. India is currently the fastest growing economy and intensifying strategic ties, bilateral trade and economic partnership will in best interest of both countries.

Through his phenomenal diplomatic outreach, Modi established strong connect with Barack Obama, Shinzo Abe, Angela Merkel, David Cameron and Francois Hollande but such a chemistry is not witnessed with Putin. India’s growing ties with the US had offended Russia. But as an emerging economy, it is incumbent on India to expand strategic ties with west and Japan for larger geopolitical advantage, to contain the assertiveness of China and to attract investments and technology. Contemporaneously, India has to infuse more confidence in bilateral ties with Russia, with which it has special and highly privileged partnership. Indeed, Russia needs to understand that India is now no longer a balancing power but a leading nation in South Asia.

 

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