Russian regions to be locomotives in promoting Russian-Indian trade and economic cooperation

Wednesday, 24 December 2014 20:01

Russian regions could become locomotives in promoting trade and economic cooperation between Russia and India, says Russian ambassador to India Alexander Kadakin.

He also emphasized the importance of launching the International Transport Corridor (ITC) “North-South” at the earliest time possible for increasing the bilateral volume of trade.

His Excellency the Ambassador gave an interview to Radio Sputnik correspondent Natalya Benyukh.

Correspondent: The year 2014 is ending. In the last month of the year, Russian President Vladimir Putin visited India. How do you assess the outgoing year from the standpoint of the developments in Russian-Indian ties? For us it is important to know the ambassador’s opinion about the outcomes of the Russian President’s visit to New Delhi.

Kadakin: Firstly, I would like to extend my best wishes to thousands and thousands of listeners of Radio Sputnik for the New Year. The embassy has long had friendly relations with the listeners of your broadcasting service. We wish the employees and listeners good health and a lot of success.

According to my opinion, the outgoing year has every reason to be a milestone in Russian-Indian cooperation. Russia’s turn to the east and the coming to power of the stable one-party government headed by result-oriented and pragmatic Prime Minister Narendra Modi are powerful factors, which will undoubtedly act as a catalyst in further strengthening Russian-Indian ties. The outcomes of the major political event of the year, the December summit in New Delhi, can be described as triumph, because they have graphically reaffirmed the consistency of the two countries’ policy of further strengthening the special and privileged strategic partnership, giving a new substance to political, trade and economic, military and technical, scientific and humanitarian relations. A substantial package of documents was signed. Some of them are commercial agreements aimed at boosting and providing new impetus to bilateral trade and economic ties, which have remained to be the weakest link in bilateral relations despite all efforts, while some others have major and mainstream qualities, which seal the common vision of the future in cooperation between our countries.

Correspondent: As a well-established “guru” in Russian diplomacy, you have long been actively contributing to Russian-Indian relations and more than once took part in Russian-Indian summits. What is the difference between the summit in early December and the other previous meetings of the leaders of the two countries? What was the atmosphere of the recent summit in Delhi?

Kadakin: Yes, since 1973, I have been lucky to participate in all Russian-Indian summits as a translator, expert and later as ambassador. I would like to emphasize that all those meetings were held in a friendly, warm and trustful atmosphere because our relations are based on a nation-wide consensus and mutual affection between the people of the two countries and do not depend on political expediences in the outside world or within our countries. The summit in New Delhi in December was not an exception. It was a dialogue between friends and like-minded persons, which was aimed at achieving practical, tangible results.

Nevertheless, every meeting between the leaders of Russia and India has its own chemistry, which makes it a milestone and important event in outlining new avenues in cooperation, working out joint steps and making amendments to the adopted policy. The last summit differs from the rest as it was held against the background of a complicated international milieu as Russia has been experiencing unprecedented pressure of sanctions imposed by the West, which is trying to force us to sacrifice our state sovereignty. With that being said, the outcomes of the summit are prominent. The Indian leaders and society have completely turned down sanctions imposed against Russia by the West. The participation of the leader of the Republic of Crimea in the delegation, who signed a business memorandum of cooperation in New Delhi, clearly illustrates this. These were the first full-format talks between the Russian President and the new Indian leader, Prime Minister Narendra Modi. As a whole, the summit marked a turn to a new quality and filling up of bilateral relations, while its significance in the complex political realities in today's world is that our countries have loudly declared to all and sundry that we have remained strategic partners and allies and this will stay forever.

Correspondent: It is no secret that the two countries made big efforts to promote bilateral trade. At present, it is a small sum, about $11 billion. There is no visible activity in trade relations. However, during the Russian President’s recent visit to India, the leaders of the two countries set the task of increasing bilateral volume of trade up to $30 billion by 2025. How are you planning to achieve this goal?

Kadakin: Well, you are right. Unfortunately, the volume of trade between the two countries leaves much to be desired, is far from their potential and significantly remains short of the high level of political relations. The outcomes of 2013 in fact showed some decline in trade, and it was estimated at about $10 billion. For such big countries as Russia and India, this is a small figure, to put it mildly. Promoting Russian-Indian trade relations was one of the key topics on the summit’s agenda. The leaders discussed in detail practical steps for diversifying bilateral trade and promoting investment and agreed to stimulate private and state-run companies to establish closer cooperation and use national currencies in mutual payments.

I believe that a growth in bilateral trade potential lies in trade and economic ties between the major state-run companies, as well as between enterprises of small-sized and medium-sized businesses. During the summit, a big package of economic agreements was signed. Among these are inter-governmental programmes in promoting cooperation in the oil and gas sphere and a strategic vision of strengthening cooperation in the peaceful use of nuclear energy, as well as an export contract between Rosneft and Essar Oil Ltd. for supplying $5 billion worth of oil over the course of ten years. Russia’s ALROSA diamond mining company and Indian companies signed a $2.1 billion contract for supplying uncut diamonds, while NMDC Indian consortium signed a memorandum on the purchase of shares of Russia’s Akron company to develop a potassium fertilizer deposit. The deal is estimated at $700 million. If in the case of all these and other agreements – the deals reached at the summit are estimated at about $100 billion - were successfully implemented, we can expect a significant growth in the volume of trade in the coming years.

By taking into account political and economic realities, we hope to step up cooperation between small-sized and medium-sized businesses in the supply of goods, especially meat and milk products to the Russian market.

New prospects for Russian-Indian trade and economic cooperation will appear from January 1st when the Eurasian Economic Union starts functioning. Working out an agreement on comprehensive economic cooperation in the format India-EEU/CU is now on the agenda. A bilateral working group set up for this purpose will start its work shortly. Updating of the Russian-Indian agreement on mutual protection and encouragement of investment will also be very significant.

All this fuels confidence that the task set for the year 2025 to increase the bilateral volume of trade up to $30 billion will be fulfilled.

Correspondent: The Russian-Indian communique released after the summit says about the International Transport Corridor North South and expresses intention to make coordinated efforts to bring the project to full force and effect. What are the planned steps for this purpose? What are the project’s prospects?

Kadakin: The International Transport Corridor North-South is one of the largest international projects with the involvement of South and Central Asia, the Persian Gulf and Eastern Europe. It is a combined route for the transportation of cargos and passengers from St. Petersburg to Mumbai Port and is 7,200 km-long. The project is aimed at creating maximum opportunity for the movement of transit cargo from India, Iran and other Gulf states on the Russian territory (through the Caspian Sea) and from thereafter to Northern and Western Europe. This significantly reduces both time for the movement of cargos through the territories of the participant countries and the cost of their delivery.

At present, the route does not function at full capacity. Individual cargo is being transported in test mode. At the same time, I would like to emphasize that Russia had long fulfilled agreements reached earlier. Russia is ready to receive cargos. It has already created the necessary railway infrastructure from Astrakhan and commissioned Port Olya in the Caspian Sea. Until recently, the absence of an appropriate railroad in Iran has delayed the implementation of the project. However, as we know, construction work has been actively resumed and will be completed shortly. India is also highly interested in launching the route at the earliest time possible.

In the context of bilateral trade between India and Russia, the ITC North-South will help to further increase the bilateral volume of trade. Individual dummy runs have proved its durability and economic viability.

The importance of the corridor goes beyond the framework of trans-border trafficking as it has huge geo-strategic significance in the context of assuring energy and economic security to the entire central Asian region.

Correspondent: The documents signed when Russian President visited India include a provision on the necessity for developing relations at the regional level. What are the Russian regions, according to your opinion, those are ready for this? What are the trends and potential for this cooperation?

Kadakin: The development of inter-regional ties is one of the prioritized trends in trade and economic and investment cooperation between Russia and India. I am happy to say that positive developments have recently occurred in this trend. The outgoing year has been very successful. The visit to New Delhi and Mumbai of President of the Republic of Tatarstan R. N. Minnikhanov and his delegation that included government officials and heads of large enterprises in the region on November 17-19 was very successful. During the visit, the delegation held meetings with key ministers of the Indian government, and the first Tatarstan-Indian business forum was held. In fact, the forum was very productive, a memorandum of understanding was signed between the Chamber of Commerce and Industry of the Republic of Tatarstan and the Confederation of Indian Industry, and agreements on cooperation were signed between the Tatarstan Development Agency and several Indian companies.

Last April, a delegation from the Kaluzhskaya region visited New Delhi, and a Protocol of Intent was signed between the Federation of the Indian Chambers of Commerce and Industry and State Fund Supporting Entrepreneurship in the Kaluzhskaya region. During the first half of November, a delegation of the representatives of small-sized and medium-sized business from the Tomsk region visited Chennai and Bangalore and signed a memorandum of cooperation in information technology, eco-products, water purification and processing domestic solid waste.

A brand new trend in Russian-Indian inter-regional cooperation has been the active work of the Russian Embassy and the Consulate-General in Mumbai, which search for Indian partners who are ready to establish full-scale partnership with economically important entities of the Russian Federation, such as the Republic of Crimea. During the first visit to India, Sergei Akseyonov signed a Memorandum of Cooperation with the “Indian-Crimean Partnership” business association. The document determines the quality of promising trends in mechanical engineering, pharmaceutics, agriculture, tourism, information technology and the creation of technological clusters. We will further help the people of Crimea to strengthen relations with Indian companies.

The forthcoming year 2015 promises to be equally successful. Preparations are now underway for the participation of Russian regions in India’s 7th Vibrant Gujarat International Trade and Investment Forum that will be held in the middle of January. It is expected that a delegation of the Astrakhan region headed by Governor A.A. Zhilkin, as well as delegations from the Altai Territory and Khanty-Mansiisk Autonomous Region. The government of the Khanty-Mansiisk Autonomous Region has proposed to conclude agreements on mutually beneficial cooperation in IT with Maharashtra, Tamil Nadu, West Bengal, Karnataka, Andhra Pradesh, Uttar Pradesh and Haryana.

The government of the Volgograd region has said that it is intends to establish official partnership with Tamil Nadu the capital of which is Chennai, the sister city of Volgograd. Traditionally, ties between Moscow and New Delhi have been very strong. A delegation from the Moscow region is expected to visit India in 2015.

Summing up the above-mentioned, I would like to express the hope that Russian regions will play the role of powerful locomotives in promoting trade and economic cooperation between the two nations. The Russian Embassy in India is ready to help in every possible way to this end.

Correspondent:In 2014, Your Excellency Mr. Ambassador has responded to the questions of the Indian department of the radio, our listeners and the users of our websites and answered a wide range of questions dedicated to Russian-Indian relations, supported our contacts with Russia’s friends in India and welcomed the 9th All-Indian Conference of Members of Listeners’ Clubs held at the Russian Centre of Science and Culture in Trivandrum on the eve of the Russian President’s visit to India. We would like to express our heartfelt thanks to you. Please, accept out greetings on the eve of the New Year. We wish you success in your duty in 2015, which is very important for Russia.

Kadakin: Thank you. For me, to cooperate with your radio through years has been a special honour and pleasure. Further success to you and your fans in India and all over the world.

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