Prime Minister Narendra Modi arrived in Moscow to a red carpet welcome on Wednesday as part of a two-day official visit to Russia. The same evening President Vladimir Putin hosted a personal dinner for a one-to-one meeting with PM Modi. The tour assumes significance for both countries as they seek to further strengthen economic, military and strategic ties.
With global geo-political relations constantly evolving, both India and Russia understand the need to consolidate relations further. The last decade saw India move closer to the US on strategic and defence relations, while Russia moved economically closer to China, even opening up relations with Pakistan through military supplies. With the West imposing economic sanctions on Russia, the importance of India to Russia’s economic growth has re-emerged as a priority and President Putin is likely to further consolidate the existing strong ties with India. The recent downing of a Russian fighter jet by Turkey has resulted in relations freezing between Russia and Turkey and India sees this as an opportunity to step in and meet some of Russia’s requirements. The Prime Minister will also be addressing a 3,000-strong Indian diaspora in Moscow.
Economic agenda Indo-Russian trade stands at $10 billion annually and both countries are aiming to raise this to $30 billion by 2025. PM Modi will be attending the 16th India-Russia Annual Summit that has been held in each country alternately, since 2000. The last edition was held in New Delhi in December 2014, which saw $100 billion worth of deals being signed between the two nations. With the PM heading an 18-member Indian business delegation comprising CEOs, it is expected that this visit, too, will result in significant business deals being signed.
Energy security On the nuclear energy front, Russia has already commissioned the 1st unit of the Kudankulam Nuclear power plant in Tamil Nadu, and is about to complete work on the second one. Initial agreement covered commissioning of four units, however, both countries are now likely to sign a deal for building the 5th and 6th units. Russia is expected to build 12 nuclear reactors in India. To further boost nuclear power generation capacity, India is likely to offer additional sites in Andhra Pradesh to Russia for setting up additional nuclear power units of 1200MW each. Energy security is top priority for India’s ambitious growth plans and Russia, with some of the largest oil and natural gas reserves, is an important source of supply for India. Indian Oil and Oil India are already in advanced talks with Rosneft for acquiring a 29% stake in a Siberian Oil field. With trade sanctions and low prices of international crude oil hurting Russia, India being the third largest importer of oil, presents an opportunity to Russia, which augurs well for both countries.
Military agenda After remaining the largest importer of arms in the world all these years, India is now pushing for ‘Make in India’ to boost local production of weapons and related equipment. For decades, Russia has been India’s largest supplier of arms but in the last decade, has lost its share to US, France and Israel. Russia is now looking at reversing this trend and wants to partner India by transferring technology for local production.
Light helicopters Towards the ‘Make in India’ initiative, companies like the Anil Ambani promoted Reliance Defence, Tata promoted Tata Advanced Systems (TAS), L&T, and several other companies, are seeking to sign up with Russian firms. Leading the way is Reliance which is expected to sign the deal for manufacturing 200 Kamov-226T light helicopters in India.
Frigates Reliance Defence which has invested heavily in acquiring naval warship building capacity, is expected to sign a deal with United Shipbuilding Company of Russia to build 4 frigates at a cost of Rs 30,000 crore at its Pipavav facility in Gujarat, for the Indian Navy.
S-400 Air Defense Missiles To strengthen the Indian air defense, India is likely to sign a Rs 40,000 crore deal to import the state-of-the-art S-400 Triumf missile systems from Russia. Code-named SA-21 Growler by NATO, the S-400 mobile missile launch system is capable of intercepting and destroying any incoming rocket, drone or aircraft, including stealth fighters. Induction of these missiles will significantly bolster air defence capability on the eastern and western fronts.
FGFA project The Fifth Generation Fighter Aircraft (FGFA) project that was earlier to be jointly built with India, has run into a stalemate. As per the initial MOU, India and Russia were to invest $6 billion each in developing the Sukhoi PAK FA T-50 Stealth Fighter aircraft, with India acquiring 214 single seat configuration aircrafts. Given the stalemate, the entire deal is likely to be reviewed and it is believed that Russia plans to offer a fresh deal to break the deadlock. Russia is presently facing a severe cash crunch and India can be expected to undertake some hard negotiations to strike a favourable deal. Between the aircraft, missile and frigate deals, Russia will be back on the leading partner list of arms suppliers to India.
Terrorism agenda Russia is seeking a more active role in international affairs and has been directly involved militarily in Syria. Terrorism has been on top of its agenda, as it faces terrorism from Chechen rebels at home, as well as potential threats from ISIL in Syria and from Afghanistan. Russia seeks to work closely with India in strengthening co-operation, especially in Afghanistan, which is witnessing increased terror resurgence by the Taliban.
Netaji files PM Modi is likely to raise with President Putin the declassification and release of the Netaji files lying with the KGB. This has been a deeply emotive issue in India and will be important in adding to the declassified information held by the Indian government that will be released to the Indian public in January 2016, as announced. The two-day tour of Russia will add to PM Modi’s list of impactful international tours and it is hoped that increased co-operation spreads to other areas like joint scientific research, culture and tourism exchanges.
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