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27 Dec, 2023 05:56

Russia-India trade to hit record high – minister

Trade reaches $50 billion as the two countries explore new areas of cooperation
Russia-India trade to hit record high – minister

Russia’s trade minister has welcomed an upcoming milestone in economic ties with India, while meeting the country’s top diplomat, currently on a four-day visit to Moscow and St. Petersburg.

Industry and Trade Minister Denis Manturov told External Affairs Minister Subrahmanyam Jaishankar that despite the challenges faced by both countries, economic ties are developing rapidly.

“There is no doubt that Russian-Indian trade will exceed the significant milestone of $50 billion by the end of this year, and set a new historical maximum,” the Russian official remarked.  

The discussions took place at the ‘Russia’ expo, held at Moscow’s VDNKH complex, where 89 regions of Russia showcase their economic, scientific and investment potential. According to a Russian government statement, they addressed trade, investment, banking and logistics, along with energy and food security. “Special attention was paid to advancing priority projects in industrial cooperation,” the note added.

Following the talks, the countries signed a memorandum of understanding between Roszdravnadzor – Russia’s healthcare regulator  – and the Central Drugs Standard Control Organization of India.

During his interaction with the Indian community in Moscow, S Jaishankar announced a new agreement between India and Russia on the construction of additional reactors at the Kudankulam Nuclear Power Plant (KNPP) in India’s southern state of Tamil Nadu.

Currently, the project comprises two operational reactors with 1 GW capacity each, while an additional four are under construction. They are set to be completed by 2027, resulting in a total capacity of 6 GW.

Jaishankar's visit to Moscow follows a surge in transactions between the two nations, since the introduction of far-reaching Western sanctions on Russia. New Delhi has ramped up imports of Russian commodities including oil and coal, and also strategic items including defense equipment. Diversification of trade, and the move towards transactions in national currencies, continue to hold prominence in bilateral discussions.

The sides are working on alternative transaction methods after the disruption caused by Russia's exclusion from the widely used international payment system, SWIFT. Moscow currently holds a surplus of more than $40 billion in special vostro accounts in Indian banks in the local currency, due to payment settlement challenges. Moscow has persistently urged greater commitment, particularly from Indian financial institutions, to adopting rupee-ruble payment mechanisms on a larger scale, given the expanding trade volumes.

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