On September 5-8, 2022, Russia will host the Eastern Economic Forum in Vladivostok, which is recognised to make a significant contribution to building business ties between Russia and the countries of the Asia-Pacific region, as well as to attracting investment flows and technological innovations, and to more fully disclose the rich economic and social potential of the Russian Far East.
The central theme of this year’s meeting is “On the way to a multipolar world”. The Russian organisers of the Forum are confident that the obsolete unipolar model is being replaced by a new world order based on the fundamental principles of justice and equality, recognising the right of each state and people to their sovereign path of development. In the Asia-Pacific region, powerful political and economic centres are being formed, acting as the driving force of this irreversible process.
In the background of the Forum, politicians and entrepreneurs, experts and public figures from 40 countries will discuss a wide range of issues related to the prospects for deepening trade, investment, and scientific and humanitarian cooperation. The attendees planned to conclude commercial contracts and long-term agreements with the participation of business circles and regional authorities.
A round table “Russia – India” will be held within the framework of the Forum. The event’s press release notes that there has been a steady increase in trade turnover between Russia and India in recent years. By the end of 2021, the trade turnover between the countries amounted to $ 13.5 billion, marking an increase of almost 50% compared to the pandemic year 2020. It is evident that the pace of development of trade and economic relations between the countries is enormous, and the potential for cooperation has not been fully realised. The two countries’ leaders set the goal to reach a volume of mutual trade equal to 30 billion dollars by 2025. Developing trade and joint projects and investments are necessary to achieve this business turnover.
We met Dr Shoaib Khan, Founder and President of ALFAAZ Education and Cultural Society, Mumbai Visiting Faculty, Centre for Central Eurasian Studies, University of Mumbai, Lecturer, Mahim Social Workers College, Mumbai, to analyse the current state of relations between Russia and India, key areas of cooperation and expectations from the Eastern Economic Forum.
How do you assess the current relations between Russia and India, and how have they been affected by the change in the global geopolitical situation after February 24, 2022?
“The traditional friendship between Russia and India has “stood the test of time” since the end of the Cold War, and the two countries have developed and maintained deep, cooperative ties on arms like fighter jets, aircraft carriers and automatic weapons, as well as nuclear power in the energy sector. Furthermore, since the Soviet era, Russia has reliably supported India in multilateral frameworks, including the United Nations, on issues like Kashmir, nuclear issues and UN Security Council reform.
India’s position should not be confused with support for the Russian operation in Ukraine. Nor should it be mistaken for a continuation of its cold war-era non-alignment policies. In fact, despite Western uncertainty about whether the country, especially under Narendra Modi as prime minister, is drifting in an authoritarian direction, if anything, India is shifting away from Russia. India is pursuing what it views as its interests, which are multiple but involve a real and ongoing effort to reduce its dependence on Russia.
Despite its discomfort with Moscow’s war, New Delhi has adopted studied public neutrality toward Russia. It has abstained from successive votes in the UN Security Council, General Assembly, and Human Rights Council that condemned «Russian aggression» in Ukraine. Thus far, it has refused to openly call out Russia as the instigator of the crisis. For many in the United States, including in President Joe Biden’s administration, India’s neutrality has been disappointing because it signalled a sharp divergence between Washington and New Delhi on a fundamental issue of global order, namely, the legitimacy of using force to change borders and occupy another nation’s territory through a blatant war of conquest.
Whatever their views on the Ukraine war’s genesis and precipitants, most Indian strategic elites would admit that their country’s diplomatic neutrality ultimately signifies what one Indian scholar has called a subtle pro-Moscow position. This seems particularly incongruous today because India stands shoulder-to-shoulder with the United States in opposing Chinese assertiveness in the Indo-Pacific while at the same time appearing tolerant of the vastly more egregious Russian belligerence in Europe.
India, for the first time on Wednesday, voted against Russia during a procedural vote at the United Nations Security Council on Ukraine. This is the first time India has voted against Russia on the issue of Ukraine after the Russian military action began in February. So far, New Delhi has abstained from the UN Security Council on Ukraine, much to the annoyance of the Western powers led by the United States. I think this may be because of western pressure and may take a new turn in Russia-India relations.”.
A Russian-Indian round table will be held at the Eastern Economic Forum-2022. What are the prospects for developing economic cooperation between India and Russia today?
“The Eastern Economic Forum (EEF) is a platform for discussing key issues related to economic development, regional integration and developing new technological sectors. The Forum’s business program includes dialogues with Asia-Pacific and ASEAN countries.
In time, EEF has emerged as an effective platform for discussing strategies for developing political, economic and cultural ties between Russia and Asia-Pacific region. The Eastern Economic Forum has been a key business event for Russia. It is part of the Russian agenda for developing the Far East and its integration into the global economy.
Over the years, it has emerged as an international platform for discussing the strategy for developing political, economic and cultural ties between Russia and the Asia Pacific.
Russia formally invited India to attend the 7th EEF to discuss the issues regarding far Eastern regions and the Arctic. The Indian delegation was invited to participate in the Arctic segment of the EEF in Vladivostok on September 5-8, 2022, which will include a presentation on the investment potential of Russian regions, as per the Russian Ministry of Foreign Affairs. The sides affirmed to deepen Russian-Indian cooperation in high latitudes in bilateral and multilateral formats, including the Arctic Council.
They also noted a significant potential for promoting cooperation in the economy, transport, science and culture, including contacts through regional and public organisations. Last year, the EEF summit was attended by Prime Minister Narendra Modi via video conferencing. India’s premier highlighted the significance of the India-Russia relationship and the potential areas of cooperation in line with the ‘Special and Privileged Strategic Partnership’.
Apart from traditional areas of cooperation such as weapons, hydrocarbons, nuclear energy (Kudankulam), space (Gaganyaan) and diamonds, new sectors of economic engagement are likely to emerge in mining, agro-industrial, and high technology, including robotics, nanotech, and biotech. India’s footprint in the Russian Far East and the Arctic is set to expand. Connectivity projects may get a boost too. The EEF is the global Forum which aims to improve the international economic relationships among countries. Thanks to this Forum, Russia helped India a lot in increasing their international affairs with China as well as expanding their economic growth by including the production of mining, improvement in the agriculture sector and many more.“.
After introducing Western economic sanctions against Russia due to its actions in Ukraine, Moscow focused on developing the North-South MTC. Do you expect a breakthrough in the development of this corridor?
“The world worried about Russia’s blockade of Ukrainian grain exports in the Black Sea in late June. Vladimir Putin had a different trade route on his mind. Addressing leaders of nations that sit on the Caspian Sea, the Russian president spoke of a truly ambitious project as the centre-piece of Moscow’s efforts to improve the transport and logistics architecture of the region. For more than two decades, the International North-South Transport Corridor (INSTC) — a 7,200-kilometre (4,474-mile) network of railroads, highways and maritime routes that connects Russia and India through Iran, has been little more than a pipe dream. But this old wine is finally ready to be uncorked by Moscow, Tehran and New Delhi, according to analysts. A rare confluence of geopolitical and economic incentives is turning the route into a potentially vital financial escape pathway for Moscow as tough Western sanctions deny the Kremlin access to European markets.
Most of Russia’s supply chains are built to cater to Europe. India, too, has largely focused on expanding trade with the West, China and Southeast Asia over the past two decades. Western sanctions on Iran further complicated the prospect of investing in the INSTC. In June, Lithuania imposed a transit ban on sanctioned goods headed for Russia’s Baltic enclave of Kaliningrad, only reversing its decision after the EU stepped in to clear the way for the cargo to travel. Earlier this month, the Moscow Times reported that Kazakhstan was proposing a law that would bar the transit of EU-sanctioned goods into Russia. All these circumstances underline how important it is for Russia to develop new supply chains and enhance others.
For years, the near-stagnant levels of India-Russia bilateral trade, which hovered between 8 billion dollars and 11 billion dollars annually, also served as a check on the ambitions of potential investors in the INSTC. The past few months have dramatically bolstered the argument for the corridor. Over April and May, India’s imports from Russia grew by nearly 272%, crossing 5 billion dollars in just two months, compared with the same period in 2021. The most significant chunk of that comes from a surge in India’s purchase of Russian crude since the start of the war: 4.2 billion dollars over April and May. But India also ramped up its imports of Russian fertilisers by nearly 800% in those two months.
More trade between India and Russia is set to flow through the ambitious International North-South Transport Corridor regularly from the coming months onwards. A significant volume of trade is set to be registered by the INSTC, India’s 7,200-km long alternate trade route to Russia through the Iranian deserts, shortly, as more Indian retailers begin to export goods to Russia soon and raw materials like coal and fertilisers flow the other way around.
After a long pause, Russia had officially expedited talks to quickly operationalise the INSTC earlier this year after the Ukraine war began and Moscow was hit with a barrage of international financial and monetary sanctions. The route is also part of India’s efforts to establish more excellent connectivity and trade with the high-potential markets of countries adjoining the Commonwealth of Independent States (CIS). This grouping of ex-Soviet nations spread across eastern Europe and Central Asia often had tenuous relations with the West in the past and have increasingly hiked their imports from China. After the Ukraine crisis, western penetration in the area is set to decrease further,” he added. Eight of the nine CIS nations are now part of the INSTC.“.
What are your overall expectations from India’s participation in the Eastern Economic Forum-2022?
“India can double down on the Russian dimension of its multipolar Grand strategy to make inroads in its partner’s resource-rich and geo-strategically positioned Far Eastern region. Russia needs significant investments in the Far East to have a more solid basis upon which to build the geo-Economic dimension of its Indo-Pacific strategy. China’s already a key player in that part of the country, but the Kremlin pragmatically wants to preemptively avert any potentially disproportionate dependence on the People’s Republic there, just like it hopes to do in general, as earlier explained. Japan and the Republic of Korea were once considered to be promising partners for diversifying Russia’s development of the Far East. However, after the Ukrainian Conflict, those two were reluctant to offend their American military ally by expanding trade with Moscow.
India, therefore, does not have much competition there in this respect since Delhi has already proven that it would not unilaterally concede on its objective national interests related to its unique and privileged strategic partnership with Russia. India, as a civilisation-state, should therefore prioritise creating a comprehensive joint action plan for developing the Russian Far East, which might begin with expanding energy and other resource cooperation but will inevitably evolve into other domains, including academic, industrial, merchant, and tourist cooperation.
India is already investing in the region’s diamond, coal and gold mining fields. The two countries also agreed to cooperate in the supply of coking coal from the Russian Far East to India. Both sides explored the idea of temporarily replacing the workforce from India in this region. The global climate change that will impact Siberia would open up opportunities in this region’s scientific and non-scientific fields, including infrastructure building. India can use its good office to focus on this part long-term.
In the energy sector, the future graph looks promising, and what is more, with the tension between Iran and the US, export from Russia is a welcome step for India. Praising the existing energy engagements, India and Russia determined to forge cooperation in geological exploration and joint development of oil and gas fields in Russia and India, including offshore fields. They agreed on the long-term flow of energy from Russia to India, including through the Northern Sea Route in the Arctic. India’s keenness to cooperate with Russia in the Arctic is a positive step for New Delhi as the country would be able to develop a more detailed Arctic policy. There is a general assumption amongst some strategic thinkers that India does not have an Arctic policy, and its engagement as an observer member at the Arctic Council extends majorly to the scientific field.“.
Author: Shoaib Khan. This interview is published in a media partnership with Kaspijskij Vestnik. Disclaimer. The views and opinions expressed in this report are those of the author and do not necessarily reflect the official policy or position of SpecialEurasia.