India and Russia to Deepen Trade and Economic Relations

• 19 Apr 2023

Recently, India and Russia have agreed to deepen their trade and economic relations, with Russia looking to increase machinery imports from India to improve the trade balance.

• The announcement of a potential free trade agreement (FTA) between India and Russia comes as the two countries are looking to further boost bilateral commercial ties.
• The FTA talks are significant in the context of economic relations between India and Russia.
• However, Western countries have called on India to distance itself from Russia over its invasion of Ukraine in February 2022.
• Russian Deputy Prime Minister and Trade Minister highlighted that road construction material and equipment, as well as chemicals and pharmaceutical products are in high demand in Russia, and he hopes this will create opportunities for Indian companies to increase their supplies to Russia.
• He flagged the issue of payments in bilateral trade, which has deepened in the backdrop of Western sanctions on Russia.
• He also suggested that Russia would consider widening the use of national currencies and currencies of friendly countries.
• India has been keen on increasing the use of its rupee currency for trade with Russia.
• Indian Foreign Minister expressed hope that the FTA discussions would resume, saying that they had been disrupted due to the COVID-19 pandemic.
• He also highlighted the potential benefits of Russian technology for Indian businesses, while also addressing payment, certification, and logistics issues.
• The announcement of the FTA talks and the deepening of trade relations comes as India is also engaged in FTA discussions with Britain, the European Union, and the Gulf Cooperation Council.