Status: 04/17/2023 12:25 p.m
In view of the western sanctions as a result of the Ukraine war, Russia is looking for new trading partners. India plays an important role in this. Now there are plans for a free trade agreement.
India and Russia want to strengthen their economic relations with a free trade pact. There is an advance agreement on this, said Indian Foreign Minister Subrahmanyam Jaishankar at an event in New Delhi today. According to the Russian Trade and Industry Minister Denis Manturov, a guarantee for bilateral investments is planned.
In view of the western sanctions because of the Ukraine war, Russia wants to expand its trade relations with other countries, especially in Asia. India has not explicitly criticized Russia’s war of aggression against Ukraine and has called for a peaceful solution to the conflict through dialogue.
Most important crude oil supplier for India
Russia has now become India’s most important supplier of crude oil, overtaking Iraq. Overall, Indian imports from Russia in the 12 months ended March 31 nearly quadrupled to $46.33 billion. However, Russia is forced to sell its crude oil at high discounts.
Industry Minister Manturov said Moscow is striving to increase machine imports from India. “We need to find a niche in products that India can replace,” he told reporters. Trade between India and Russia has skyrocketed since the West imposed sanctions on Russia over last year’s invasion of Ukraine. This has not only changed the flow of goods in the raw materials market.
Russia exports products from key sectors
Reuters news agency reported in November that Russia may want to import more than 500 products from India for key sectors such as cars, planes and trains. Because of Western sanctions, Moscow is struggling to keep Russia’s core industries running. India, in turn, is keen to reduce its growing trade deficit with Russia. The country has been India’s largest supplier of military equipment for decades and is also the fourth largest market for Indian pharmaceuticals.
Foreign Minister Jaishankar said Indian economy could benefit from Russian technology. The government is therefore working to solve the problems in the areas of payments, certification and logistics.
Relations with Gazprombank deepened
In order to speed up trade between the two countries, Russia’s Gazprombank has also expanded its ties with India. “We have worked hard to establish our partnership with Indian banks and our representatives here have worked hard,” Elena Borisenko, deputy chief executive officer of Gazprombank, told Reuters on the sidelines of an India-Russia business dialogue event in New Delhi.
Gazprombank is Russia’s third largest lender by assets. It plays an important role in handling Russian energy trading.