Russia agrees to give greater market access to Indian goods

New Delhi: Russia on Friday agreed to give greater market access to Indian goods to address India's concerns over the increasing trade deficit in Moscow's favour as boosting economic cooperation was the central focus of summit talks between Prime Minister Narendra Modi and Russian President Vladimir Putin.

The overarching focus of the summit was to expand and strengthen the economic dimension of the India-Russia partnership to advance towards the shared goal of reaching USD 100 billion in bilateral trade by 2030, Foreign Secretary Vikram Misri said.

"The India-Russia relationship also remains an anchor for constructive engagement in an increasingly complex geopolitical environment, and both our sides are committed to continue to do our part in addressing the challenges that the current environment poses for both countries," he said.

The two sides also reviewed their wide-ranging cooperation in the energy sector, against the backdrop of mounting American pressure on India to stop procurement of Russian crude oil.

"Economic cooperation, I would say, is the driving impulse and the most important focus of this particular visit (of President Putin)," Misri said at a press conference.

Expanding bilateral trade and strengthening economic cooperation requires swiftly addressing non-tariff barriers and regulatory impediments, he said, adding that enhancing Indian exports to Russia in sectors such as pharmaceuticals, agriculture, marine products and textiles was a key discussion point.

"Each one of these sectors, in considerable detail, was discussed between the two leaders today, with both of them pointing to the opportunities that existed in these areas and what were the steps that were needed, that could be taken by both sides in order to move towards the mutually shared objective of increasing trade in these areas," Misri said.

There have been concerns in New Delhi over a ballooning trade deficit in favour of Russia. India's annual procurement of goods and services from Russia amounts to around USD 65 billion, while Russia's imports from India stand at around USD 5 billion.

To a question, Misri said both countries are continuing to work together to promote mutual trade in national currencies.

"You would be aware that special Rupee Vostro accounts have been opened in significant numbers. They right now form a very effective mechanism in terms of lubricating the trade flows between the two countries," he said.

"I think there are close to two dozen banks that have opened a large number of these special Rupee Vostro accounts that facilitate the trade between the two countries currently," he said.

The foreign secretary also responded to a question on the volume of India's procurement of Russian crude oil going down following American sanctions on two Russian oil giants.

"We have been fairly clear in terms of communicating that as a significant importer of energy, our priority is to ensure that 1.4 billion people in India have their energy needs secured," he said.

"Our energy sourcing policies are guided entirely by this imperative. Ensuring stable energy prices and securing supplies are the twin goals of our sourcing policy. And part of this, therefore, goes into the area of diversifying energy supplies. Our partners, traditional as well as new, understand this and appreciate this," he added.

In the talks, both sides noted the current and potential cooperation between Indian and Russian companies in fields of oil and oil products, oil refining and petrochemical technologies, oilfield services and upstream technologies, and related infrastructure, a joint statement said.

The discussions also touched upon cooperation in LNG (Liquefied Natural Gas) and LPG (Liquefied Petroleum Gas) related infrastructure and underground coal gasification (UCG) technology.

The two sides also noted the importance of expeditious resolution of issues related to investment projects in this area and agreed to resolve the various concerns being faced by their investors in the energy sector, the statement added.

They agreed to continue jointly developing systems of bilateral trade settlements through the use of national currencies.

"Additionally, the two sides have agreed to continue their consultations on enabling the interoperability of the national payment systems, financial messaging systems, as well as central bank digital currency platforms," it said.

India and Russia welcomed steps to ensure the long-term supply of fertilizers to India and discussed the potential establishment of joint ventures in this area.