Russia is India’s main partner in nuclear energy, defense, space, science and technology
Indian Ambassador to Russia, Ajai Malhotra, told ‘Nezavisismaya Gazeta’ observer, Vladimir Skosyrev, that Russia-India relations are based on trust and support of parties of both countries. Cooperation between our countries has a solid base of common interests and growing economic opportunities, which was not affected even by the world crisis, which had a negative effect on the world trade. On the contrary, our bilateral trade turnover continued to grow, and our countries started new joint projects.
Russian and Indian leaders say that relations between our countries are based on the principle of privileged strategic partnership. What does it mean in practical terms?
Nowadays, many countries freely and rather loosely use the term strategic partnership to describe the nature of their relationship. Yet, it has a very special and deep connotation where India-Russia relations are concerned.Our unique and multi-faceted ties reflect the extraordinary goodwill and trust between us and our exemplary sensitivity to each other’s security and other concerns.
Neither India nor Russia perceives a threat from the other; instead, each sees benefit for itself in the increased political and economic strength of the other. There is also unanimity, cutting across party lines in India and Russia, for close and friendly relations between us.
In real terms, Russia is the first country with which India instituted the practice of Annual Summits, reflecting a shared desire to consistently promote and guide our strategic partnership at the highest level. Our partnership extends beyond regular and productive political interaction at the Summit level, to close cultural ties and long-term cooperation in many key and sensitive areas. Thus, Russia is India’s foremost partner in sectors like civilian nuclear energy, defence, space, and science & technology.
India’s largest Inter-Governmental Commission (IGC) on Trade, Economic, Scientific, Technological and Cultural Cooperation is with Russia. Our S&T cooperation programme too is the largest that India or Russia has with any country. All these pointers affirm that, in practical terms, the India-Russia strategic partnership is a special, privileged and substantive one and not one that is rhetoric based.
Recently India gave many big contracts to European, US & Israel companies. Is Russia role in arms industry of India diminishing?
The stiff competition Russian arms manufacturers face from arms producers of other countries on the Indian market has been around for decades, and our defence ties with Russia have grown nonetheless. In many instances Russian companies have proved competitive and emerged as valued partners in meeting our defence requirements. Equally, foreign arms manufacturers from several other countries too have won some of our defense acquisition tenders over the past few decades. There is nothing new in this.
Our defence cooperation has long been an important pillar of our strategic partnership with Russia. We manufacture T-90S tanks, SU-30MKI fighters, and other equipment. Last August agreed to jointly produce the “Smerch” rocket system in India. In 2012, we inducted the Mi-17 V5 helicopter, as well as the “INS Chakra” and the frigates “INS Teg” and “INS Tarkash”. We signed defence contracts worth about US$ 4 billion last December, envisaging delivery of 71 MI-17 V5 helicopters and 42 SU-30MKI kits by Russia to India. We regularly conduct joint military and naval exercises.
In recent years our ties have radically transformed from a buyer-seller relationship to one involving joint research, design, development, and production of sophisticated defence systems. The BrahMos supersonic missile project, which recently celebrated its 15th anniversary, was an early illustration of this fundamental shift. The Fifth Generation Fighter Aircraft project and the Multi-role Transport Aircraft (MTA) project are more recent examples of it. These projects provide compelling evidence of a dynamic, long-term military-technical partnership, which is not a diminishing one.
Will India participate in developing GLONASS system?
At the 13th India-Russia Annual Summit last December, NIS-GLONASS of Russia signed an MoU with Bharat Sanchar Nigam Ltd (BSNL) & Mahanagar Telephone Nigam Ltd (MTNL), for a pilot project to assess the GLONASS System using BSNL/MTNL ground infrastructure. Its success would open the way for the application of GLONASS in India in sectors like disaster management, intelligent transportation, telephony and long-distance communications. Incidentally, NIS-GLONASS also signed last December a Strategic Cooperation Agreement with Tata Consultancy Services for technology partnerships. So, the first exploratory steps as regards GLONASS are already underway.
The Nuclear Power Plant in Kudankulam is the biggest Russian industrial project in India. What is the reason for delaying of commissioning it? When unit 1 & 2 will be launched?
The developmentof India’s nuclear energy programme has been one of the important pillars of our cooperation with Russia. We are incorporating the best technology in our nuclear power plants so as to maintain the highest and most advanced safety standards. Unit 1 of the Kudankulam Nuclear Power Plant has been completed and it is expected to be operationalised this month. The second 1000 MW unit at Kudankulam is also being expedited and should be ready later this year.
India agreed that Russia would also construct unit 3 & 4 at Kudankulam. But there was a disagreement concerning the legal & civil responsibility in case of nuclear incident. Has a solution been found?
We are committed to implementing the 2008 India-Russia agreement on nuclear power cooperation and the 2010 Road Map on construction of Russian designed nuclear power plants in India. As regards Kudankulam Units 3 & 4, the financial Protocol for state credits for construction of both the units was signed in July 2012.
The volume of Indo-Russian trade does not correspond with the high level of political relations of our countries. What is being done to improve the situation?
We are acutely aware of the need to enhance India-Russia trade and are always actively looking for new ways and opportunities to do so. Seeking to boost our trade we actively harnessed numerous institutional mechanisms and business-to-business platforms during 2012. Our Commerce, Industry and Textiles Minister led a high-level business delegation in June 2012 to the St. Petersburg International Economic Forum. The 3rd India-Russia Business Dialogue was convened on its margins. Last autumn, numerous Indian trade promotion councils, commodity boards and other delegations participated in trade shows in Russia.
As a result, India-Russia trade expanded 24.5% last year, rising from $8.87 billion in 2011 to US$ 11.04 billion in 2012. In percentage terms, the India-Russia trade performance in 2012, vis-a-vis 2011, was the best out of all of Russia’s top 25 trading partners. In terms of trade volume, India moved up five places in the list of Russia's top trading partners – from 23rd in 2011 to 18th in 2012. All this is even more creditable when viewed against the present world economic situation, the modest 1.8% growth in Russia’s world trade, and no growth in India’s world trade. We would continue to put in hard work to see that our trade meets the goal of US$20 billion in 2015.
What is the volume of Indian investments in Russia? Why is Indian big business reluctant to invest in Russia?
Indian investments in Russia are about US $8 billion and exceed Russian investments in India. Our companies with major investments in Russia include ONGC Videsh Ltd, State Bank/Canara Bank through their joint venture Commercial Bank of India Ltd, ICICI Bank, Tata Group, SUN Group, Carborundum Universal, L&T, Universal Food Technology, etc. Many Indian pharma companies also have a robust presence in Russia.
Part of the reason for the reluctance to invest shown by businessmen on both sides is that there is not enough exposure to each other's improved economic situation and latest achievements. We will continue to put in effort to correct this so that Russian companies become more aware of our capabilities and are more responsive to opportunities in India, and vice versa. Economic slowdown elsewhere in the world is also compelling our businessmen to more attentively explore trade and investment opportunities in both countries. Russia’s entry into WTO too is opening up new opportunities.
Meanwhile, there have been several welcome developments recently in December 2012. State Bank of India and Russian Direct Investments Fund signed a MoU for a US$ 2 billion fund to facilitate investments in long-term projects in both countries. At the same time, a JV was also signed between Elder Pharmaceuticals Ltd., Mumbai, and PharmEco of Russia.
India takes part in oil & gas projects in Sakhalin. When will LNG shipments to India be regular?
The energy sector illustrates our strong complementarities. Russia is a major energy producer, while India is one of the faster growing energy consumers.
ONGC Videsh Ltd has large investments in Sakhalin-I and Tomsk, and the most oil it presently receives in return for its foreign investments is from Russia. It is considering new investment opportunities in oil and gas via equity participation in projects in Siberia, Russia's Far East and the Arctic Shelf, with companies such as Rosneft, Gazprom, and Novatek.
Russia evidently does not have spare LNG to offer for export at present. However, this picture is likely to change in the next few years; so, looking ahead, we have started firming up arrangements. Thus, in 2012 India signed a long term LNG Sales and Purchase Agreement with a wholly-owned subsidiary of Russia’s Gazprom for the purchase of 2.5 million metric tonnes of LNG per annum starting 2018-19 and continuing for the next two decades.
More than 100,000 Russian tourists visited India last year. Israel & many other countries removed visa requirement to promote tourism from Russia. Why does not India follow this way?
The more liberal visa regime that we implemented in June 2011 has contributed to the 22% annual growth in tourism from Russia to India during 2011 and 2012. Visas issued by the Embassy of India, Moscow, and our Consulates in St. Petersburg and Vladivostok, increased from 107,000 in 2010 to 131,000 in 2011 and crossed 160,000 in 2012. We are undertaking fresh tourism promotion initiatives across Russia this year and expect this trend to strengthen. In fact, the number of visas issued to Russian tourists by the Indian Embassy in Moscow spurted by almost 60% during the first quarter of 2013, compared to the first quarter of 2012. At this pace over 250,000 Russian tourists should be visiting India this year!
India has a visa free regime for Russian diplomatic and official passport holders but such an arrangement for Russian tourists is not presently being considered. Instead, we are exploring the possibility of visa-on-arrival for tourists from Russia and some other countries; however, no decision has been taken in the matter as yet.
