Valdai Club

Indian Prime Minister Narendra Modi’s recent visit to Russia provided fresh impetus to the strategic partnership between Russia and India.

This visit reinforced interests of both states in maintaining their traditionally close and friendly relationship and in strengthening a multipolar world order. In recent times, both India and Russia have been pursuing a multi-vector approach in their foreign policies. This visit was Indian Prime Minister Modi’s second visit to Russia within a year’s time; his first visit was in July 2015 to Ufa (Russian Federation) to participate in the BRICS (Brazil-Russia-India-China-South Africa) and SCO (Shanghai Cooperation Organisation) Summits.

The bilateral relationship between India and Russia was revived with the declaration of a Strategic Partnership between the two countries during the visit of President Putin to India in the year 2000. Since then the Indo-Russian relationship has diversified enormously and today it is uniquely strong and also expanding in the areas of defence, nuclear energy, hydrocarbons, space research, science & technology. Prime Minister Modi’s recent visit re-activated the ties between two countries. During this visit India and Russia signed number of significant agreements, including the agreement for manufacturing of Kamov 226 helicopters in India. This is going to be the first project for a major defence platform under Modi’s ‘Make in India’ policy, and also to enhance the defence partnership between Russia and India. Cooperation on number of other significant defence projects would also boost defence cooperation.

Bilateral cooperation in nuclear energy is increasing over the years. India and Russia made progress regarding twelve Russian nuclear reactors at different sites. The agreement on nuclear cooperation will increase Indian manufacturing content for these reactors. This also supports Prime Minister Modi’s ‘Make in India’ mission. Other benefits from this agreement would include research and development, construction of nuclear plants and reprocessing of spent fuel. The signing of this landmark inter-governmental agreement on the peaceful use of atomic energy between the two countries has the potential to expand the horizon of nuclear relationship between the two Nations.

Prime Minister Modi mentioned that Russia being world’s largest reserves of hydrocarbons can be a critical source of energy security for India; hence, the agreements signed for Indian investments in Russian hydrocarbon sector will enhance energy cooperation between two countries. Agreement for cooperation for geologic survey, exploration and production of on-shore hydrocarbons between Rosneft Oil Company, Oil India Limited and Indian Oil Corporation Limited has been signed during this visit.

India and Russia are also moving towards expanding the economic relationships which is the weakest link in the bilateral cooperation. It has been observed that in spite of accelerated growth and immense opportunities in each other's economy, statistics show business transaction is much less than the real potential. Promises had been made by the leaders of both countries earlier, but not much has happened. However, to put these words into practice and strengthen the economic relationship, India has created a special notified zone to facilitate direct trade between the world’s largest uncut diamond exporters (Russia and India process 90% of the world’s uncut diamonds and will now cooperate in this sector successfully).

Also the work on logistics is going on to make trade and economic cooperation faster. The Green Corridor project took off and the International North South Transit Corridor (INSTC) through Iran is expected to significantly reduce transportation time and cost. Now India and Russia are also moving forward to fulfil the India-Eurasian Economic Union (EEU) Free Trade Agreement. This will also benefit to connect Central Asia easily. The agreements and the announcements made during this visit gave confidence that now India and Russia will see huge increase in investments and trade from both directions.

Prime Minister Modi and President Putin assured strong commitment to deepen the cooperation in the international arena too. Prime Minister The leaders agreed that early political settlement through dialogue in West Asia is essential for restoring stability and containing extremism in the region. There is a close synergy in Indo-Russia perspectives. The joint declaration reinforced the warmth that exists between the two countries. Although differences arise over certain issues on certain occasions, the overall parallelism in the India-Russia relationship definitely symbolizes the trust that still exists between the two nations.