External Affairs Minister S. Jaishankar today stressed the need for urgent redressal of balance of trade between India and Russia.
He was delivering the keynote address at the India-Russia Business Forum in Mumbai.
The External Affairs Minister said that although the bilateral trade is progressing at a satisfactory pace, the balance of trade needs urgent redressal.
He said that the bilateral trade is USD 66 billion and makes the goal of reaching USD 100 billion by 2030 more than realistic.
“The balance of trade however needs urgent redressal since it is so one-sided.,’’ Jaishankar said while addressing the forum in the presence of Russia’s first Deputy Prime Minister Denis Manturov and Minister Sergey Cheremin.
Jaishankar said, “It is imperative that non-tariff barriers and regulatory impediments are speedily addressed for this to happen.”
According to the Department of Commerce, in FY 2023-‘24, bilateral trade reached an all-time high of $
65.70 billion [India’s exports: USD 4.26 billion; and India’s imports: USD 61.44 billion].
Major items of export from India include pharmaceuticals, organic chemicals, electrical machinery and mechanical appliances, iron and steel.
The major items of import from Russia include oil and petroleum products, fertilizers, mineral resources, precious stones and metals, vegetable oils.
Bilateral trade in services has remained stable during the last five years with trade balance in Russia’s favour.
Ambassadors of the two countries and the FICCI President, Anish Shah were also present at the meeting of the forum.
He also spoke of economic complementarities and emerging opportunities in a multipolar world for greater India Russia business cooperation.
In his welcome address, Denis Manturov mentioned the “record volume of trade turnover that we reached last month.”
He added, ” And there are all the prerequisites to surpass this achievement.”
The forum meeting is taking place barely 90 days after the Annual Summit between leaders of the two countries in Moscow.
The two sides also had another opportunity to interact last month in Kazan.
They discussed and explored new business opportunities at the business forum.
On Tuesday, the Russian Business Centre will be opened in New Delhi, sources in the Russian embassy said.
The centre will open on the day the India-Russia Inter-Governmental Commission’s is scheduled to take stock of bilateral cooperation.
It will focus on developing business ties between the two countries and promoting export cooperation
It will also provide the business communities of both countries a platform for interaction.
The External Affairs Minister said that Russia’s conscious focus on Asia in the last two years has created many more areas of cooperation.
He said that India Russia partnership serves mutual and global interests.
While India has an eight per cent growth rate for multiple decades ahead, Russia is a key natural resources provider and a major technology leader.
Enumerating 10 significant developments in partnership between the two countries. Jaishankar flagged issues that need to be expedited.
He said that mutual settlement of trade in national currencies is of great importance, especially in the current circumstances.
“Special Rupee Vostro Accounts are right now an effective mechanism.”
He further said, ” Even in the short run, a better trade balance with national currency settlements is the answer.’’
The India-Eurasian Economic Union trade in goods negotiations which commenced in March this year, need to be taken forward vigorously.
The first ever bilateral Investment Forum took place in Moscow in April 2024.
“We also need to expedite negotiations on the Bilateral Investment Treaty.’’
The programme for cooperation in regard to the Russian Far-East from 2024-29 was signed in July during the Annual Summit.
Signing of a bilateral agreement between the customs authorities of the two countries in May 2024 on Authorized Economic Operators, has had a big impact on smoothening the ease of doing trade.
Jaishankar said that the three connectivity initiatives– INSTC, Chennai-Vladivostok Corridor and the Northern Maritime Route – need continued attention to tap their full potential.
“A growing Russian appreciation of Make In India as a programme to deepen business will certainly help to take forward our cooperation in many many domains.”
He also drew attention to the importance of non-economic domains, such as education and film as contributions to a larger societal but also an economic connect.
“It is natural that there would be concerns, such as banking and payment related issues, logistical challenges like shipping, insurance and reinsurance as well as market access.”
He said that both counties need to find solutions that work to the comfort level of those actually involved in trade.
“ We are all aware of the complementary nature of our respective economies.
If we recognize that fully, then it also follows that our approach is not transactional but aimed at building long-term partnerships.”
In energy domains such as oil, gas, coal or uranium, India will always be a major player in the international markets.
This applies as well to the demand for fertilizers of various kinds.
“Constructing a mutually beneficial arrangement will help us both address the volatility and the uncertainty of our times,” Jaishankar said.
Manturov mentioned the pilot project of the Russian Agency for Strategic Initiatives to create a ‘Single Export Channel System’.
The initiative consolidates information about Russian companies and includes those ready to work in the Indian market and those interested in import supplies.
