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INDIA-RUSSIA ECONOMIC RELATIONS NEED A MEGA PUSH

MODI HAS TO TAP UNREALISED POTENTIAL IN JUNE SUMMIT

By Arun Srivastava

India boycotting the Belt and Road Forum (BARF) meet in Beijing has sent the message across that while doing so, India has isolated itself both regionally and globally. The BARF meet was attended by all the South Asian neighbours of India. Even the countries identified as India’s partners in resisting Chinese aggression in Asia and South East Asia having territorial disputes with China, as India has, did not abstain from the meet.

In this backdrop Prime Minister Narendra Modi attending the St. Petersburg International Economic Forum in Russia, just within a month of the Chinese event, to be held from June 1 to 3 as the ‘Guest of Honour’ will be a major occasion to bolster India’s image globally and also present it as a major player in the global arena.

China may abhor the idea of Indian primacy in the subcontinent or in the Indian Ocean but it is also a fact that Russia is striving to project India as a key player in the region. t is now for India to gain maximum benefit out of this Russian gesture. India obviously will need to articulate an alternative narrative which counters Chinese hegemony. We need to rethink our regional strategy which may require far greater focus on securing our neighbourhood.

The St. Petersburg International Economic Forum (SPIEF) is a unique event in the world. It has been held since 1997, but since 2005 the event is being organised under the auspices of the President of the Russian Federation. This is enough to underline the global importance attached to the summit. The Forum has become a leading global platform to meet and discuss the key global economic issues facing the emerging markets.

SPIEF provides the unique opportunities to meet with high-ranking international policy makers, leaders, government representatives, and members of foreign delegations, including from BRICS, SCO, and CIS countries. The fundamental issues and trends affecting Russia, emerging economies, and the world are identified, analysed, and publicized.

In addition to the regional events in Russia, each year the Roscongress Foundation also runs a series of overseas events aimed at maintaining cooperation between Russian and foreign officials. Foundation’s outreach events make an important contribution to tackling the economic challenges facing Russia and the world today. In 2015–2016, events were held in Italy, India, China, Germany, and Uruguay, and the 2016 programme concluded with the Russia–Iran Business Forum, which was held in Tehran.

Putin intends to carryout a serious technological modernization and looks forward to procure new technologies and attract foreign investment. Russia has not imposed restrictions on capital flow and has no plans to do so in future. If the expansion of the outreach and groundwork of the Forum during last ten years is an indicator Russia expect high-level participation at the 2017 meet and hope to make further achievements and continue the dialogue

It is a coincidence that a Russian plane maker has unveiled a new passenger jet that it believes will be able to compete with Boeing and Airbus. The new MC-21 passenger plane is scheduled for serial production from early next year. For Russian Prime Minister Dmitry Medvedev “This is a huge victory for our aviation industry and Irkut Corporation, our scientists, designers, engineers and workers”. Russian media reported that the corporation has confirmed orders for 175 aircraft from domestic and overseas clients.

India must really work on big investment projects with Russia and use the Forum to enhance defence cooperation. The SPIEF programme includes the BRICS Business Forum and B20 Forum on international trade and investment besides a Russian–Indian Forum of Corporate Executives.

On January 30, 2016, two St. Petersburg International Economic Forum panel sessions on bilateral relations between Russia and India took place in New Delhi: “Fulfilling the Indian–Russian economic promise” and “BRICS growth agenda: investment hot spots in Russia”.

India-Russia relationship has progressed beyond the traditional pillars of defence and space to a robust civil nuclear cooperation, collaboration in the sphere of hydrocarbons as well as long-term LNG sourcing interest. More recently, Russia has shown interest in the development of infrastructure in India with an intent to invest in Indian Railways, shipbuilding, urban development and transport & logistics. Incidentally Make in India and to transform India into a global design and manufacturing hub, is the theme of the ‘India lounge’ at SPIEF 2017.

The political leadership of the two countries has strongly reaffirmed the importance of the relationship. India’s defence equipment is 60-70 per cent of Soviet/Russian origin. Their maintenance and technological upgradation are a significant part of our defence cooperation. No country has so far matched the level of sophisticated weaponry that Russia supplies to India. The latest example is the S-400 air defence system under acquisition, which NATO acknowledges as state-of-the-art. Even with our recent diversification of arms imports, Russia supplied 68 per cent of India’s arms imports in 2012-16.

In 2015-16, Indian companies invested about $6 billion in Russia’s oilfields. In the other direction, Russian oil giant Rosneft acquired Essar Oil’s Vadinar refinery and port for an estimated Rs 86,000 crore. Rosneft now owns about nine per cent of India’s oil refining output. The Forum in fact is an effective mechanism to foil and frustrate the American and British sanctions. USA and UK are at the forefront of the sanctions regime; yet their banks participated in the investments in Russian oil companies. India must use the opportunity to emerge stronger which it was deprived by the Obama administration. (IPA Service)

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