New convergence

Russian President Dmitry Medvedev’s two-day visit to China has significance that goes beyond their bilateral relations which have been strengthening in the recent past. The focus of the visit was mainly bilateral, underlining the importance both countries attach to their economic and political ties. This is clear from the slew of agreements signed by the leaders of the two countries, covering co-operation in many areas, but mainly energy and finance. The highlight of the visit was recognition of the importance of the huge $ 25 billion 999-km gas pipeline from Russia’s far east to energy-hungry China. The pipeline, which was completed in record time, has already become operational and is the result of a loan-for oil deal between the two countries.

The importance the two countries attach to their relations is clear from the fact Medvedev’s meeting with Chinese President Hu Jintao is the fifth this year. Medvedev was also visiting China for the second time in two years. His first visit to any country after assuming office was to China. The highlight of that visit was the signing of a nuclear deal by which Russia agreed to sell nuclear reactors and cutting edge technology to China. Russian economy is mainly resource-based and Moscow is aware of the risk in having an economy that depends on fluctuating commodity prices. Moscow has for long wanted diversification of gas supplies away from Europe. It also wants to modernise its economy. Chinese experience and help would be useful for this because both countries had similar centrally planned  economies but China has reformed its economy and has gone far ahead of Russia. The complementarity on interests has given an opportunity to them to upgrade their relations. Trade between the two countries had been on an upswing, except during the period of the global slowdown, and is expected to recover this year.
The convergence of interests goes beyond the economies and covers strategic relations. Both are vary of the US and want to develop a platform which can resist Washington’s domination. The announcement that both countries would enhance co-operation in international affairs, including in forums like G-20, BRIC and the Shanghai Co-operation Organisation (SCO) is a sign of that. Russia and China are the leading countries in the SCO with which India is also associated as an observer.

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