Indo-Russian ties based on “substance, not rhetoric” - Ajai Malhotra

Ambassador Ajai Malhotra (R). Source: Press Photo/Embassy of India in Moscow

Ambassador Ajai Malhotra (R). Source: Press Photo/Embassy of India in Moscow

In an exclusive interview with RIR, the Indian Ambassador to Russia talks about the entire gamut of bilateral issues.

RIR: How doyouevaluatetheresultsofPresidentPutinsvisittoIndia?Mediacoverageofthevisitshowsdifferentviews.Ontheonehand,commentatorssaythesideshaveconfirmedspecialandprivilegedrelationsandsignedcontracts,whichleftnodoubtthatRussiaremainsIndia'smajorpartner.Ontheother,criticsargue,thissortofrhetoricdoesnotmatchreality,thedisappointingmomentsintherelationshiparestrongandthesidesdontmakeenougheffortstoovercomethem. 

We were delighted to welcome President Putin to India for the 13th India-Russia Annual Summit in New Delhi late last month. Russia is the first country with which we started such annual summits. It is one of two countries with whom we have them and the only one being regularly convened. 

The 13th Annual Summit witnessed considerable advancement on the entire range of India-Russia issues. Talks were held in the extremely warm and friendly atmosphere you would expect when two close friends meet. The summit was very productive and both sides were pleased by the progress made on issues discussed. 

Let me emphasize that the India-Russia relationship is based on substance not rhetoric. There is a unique political consensus, cutting across party lines and amongst peoples in both countries, over the high importance of close and friendly ties between us. Both countries consider the further deepening of our cooperation as being among our top foreign policy priorities. Russia is also India’s foremost partner in sectors like atomic energy, defence, space, and science & technology. India’s largest Inter-Governmental Commission (IGC) on Trade, Economic, Scientific, Technological and Cultural Cooperation is with Russia, as is our most extensive Foreign Office Consultations calendar. Russia is our leading partner in military-technical cooperation and vice versa and it is the only country with which India has an IGC on Military-Technical Cooperation. Moreover, it is convened annually at Ministerial level. Our S&T cooperation programme too is the largest India or Russia has with any country. So, a very special and privileged strategic partnership indeed exists between us.

RIR: Whatagreementssignedduringthesummit do youconsidermostimportantandencouragingfordevelopmentofbilateralrelations? 

Besides issuing a Joint Statement, documents on foreign office consultations, cultural exchanges, science, technology and innovation, telecom, financing of projects, etc., were signed at the 13th Annual Summit.

The MoU between State Bank of India (SBI) and Russian Direct Investments Fund (RDIF) is particularly welcome as it envisages $2 billion funding to facilitate investments in long-term projects in both countries. Two significant private sector joint venture documents have also been signed. One is for a JV between Elcom Systems Private Ltd. of SUN Group and Russian Helicopters, for manufacturing Kamov and Mil brand helicopters in India. Another JV, between Elder Pharmaceuticals Ltd., Mumbai, and PharmEco of Russia, envisages a $100 million plus investment for manufacturing, marketing and distributing Indian pharmaceuticals in Russia. 

We also agreed at the 13th Annual Summit to work out a list of priority investment projects and a road map for their implementation. 

Of significance too is the MoU between NIS-GLONASS of Russia, and Bharat Sanchar Nigam Ltd. & Mahanagar Telephone Nigam Ltd., for a pilot project to assess the Russian Global Navigation Satellite System (GLONASS) using BSNL/MTNL ground infrastructure. Its success would open the way for the application of GLONASS in sectors like disaster management, intelligent transportation, telephony and long-distance communications. NIS-GLONASS also signed a Strategic Cooperation Agreement with Tata Consultancy Services for technology partnerships in software development, systems integration, product engineering, etc.. 

The MoU on Science, Technology and Innovation is another important document that was signed. It will encourage our scientists to conduct fundamental and applied research to create new technologies, equipment and materials. Earlier in 2012, we operationalised India-Russia Science & Technology Centres in Moscow and Delhi-NCR to commercially harness new and innovative technologies. 

Defence contracts worth about $4 billion were also signed on the Summit day, envisaging delivery by Russia to India of 71 MI-17 V5 helicopters and 42 SU-30MKI kits. Additionally, a document was signed on December 21, 2012, to jointly develop an air launched version of the BrahMos cruise missile for the SU-30MKI. 

RIR:  Canyoubrieflysumuptheeventsinbilateralrelationsin2012?Whatwasmostimportantanddisappointingfromyourpointofview? 

There was intense high level engagement in 2012. President Medvedev was in New Delhi in March 2012 for the BRICS Summit. Our External Affairs Minister was in Moscow in April 2012, when we also marked the 65th anniversary of our diplomatic ties. Prime Minister Manmohan Singh and President Putin met on the sidelines of the G20 Summit in Los Cabos, Mexico, in June 2012. Deputy PM Rogozin visited India in July 2012 and again in October 2012 for the IGC on Trade, Economic, Scientific, Technological and Cultural Cooperation. Our Defence Ministers met in New Delhi in October 2012 for the annual IGC on Military-Technical Cooperation. All this culminated with President Putin’s visit to India for the 13th Annual Summit in December 2012. 

We also focused last year on enhancing people-to-people contacts. A more robust cultural projection of India was pursued across Russia. Our outreach to Russia’s regions was intensified. Parliamentary interaction was reinvigorated by the visit to India in December 2012 of a multi-party delegation of the Russian State Duma Group of Deputies for Friendship with India. Cooperation between academia and think-tanks in both countries was encouraged. Our bilateral trade has grown well and a liberalized visa regime has contributed to a 22 percent growth in tourism from Russia to India in 2012, compared to 2011. In fact, visas issued by the Indian Embassy in Moscow and its two Consulates increased from 107,000 in 2010 to 131,000 in 2011 and crossed 160,000 in 2012 and we expect to maintain this high growth in 2013. While their numbers remain small, Indian tourists coming to Russia have also more than doubled in 2012, compared to 2011. 

On the other hand, there is the matter of the delay in the delivery of INS Vikramaditya, which we now await in the last quarter of 2013. 

RIR:  It isobviousthattheabsenceofstrongbilateraleconomicrelationshipweakensthefoundationsofoverallties.ThevolumeofIndia-Russiabilateraltradeisnowratherlow.Doesthegoalofachieving$20billionby2015seemrealistic?Whatfactors/recentdevelopmentscangivegoodcauseforoptimisminthissphere? 

We are acutely aware of the need to boost India-Russia trade and are constantly looking for new ways and opportunities to do so. Our bilateral trade was $7.5 billion in 2009, $8.5 billion in 2010 and $8.9 billion in 2011. It is particularly noteworthy that our two-way trade grew 31.4% during January-October 2012, compared to the identical period in 2011, so that by end October 2012 we had nearly reached the trade figure for entire 2011. It constitutes the fastest growth in our trade with Russia in recent years. This substantial growth is particularly commendable given the global economic slowdown and marginal decline in India’s overall trade during 2012. 

We have put in special efforts recently to ratchet up our trade-related interaction. Our Commerce, Industry and Textiles Minister led a high-level business delegation in June 2012 to the St. Petersburg International Economic Forum. The 3rd India-Russia Business Dialogue was convened on its margins. In July 2012, the Automotive Components Manufacturers Association of India was in Russia. In September/October 2012, numerous Indian trade promotion councils, commodity boards and other delegations participated in trade shows in Russia. These included India Trade Promotion Organization, Agricultural and Processed Food Products Export Development Authority, Federation of Indian Export Organizations, Coir Board of India, Export Promotion Council for Handicrafts, Cotton Textiles Export Promotion Council, Synthetic & Rayon Textiles Export Promotion Council, Apparels Export Promotion Council, Pharmaceuticals Export Promotion Council, All India Association of Industries , World Trade Centre, Mumbai, and World Trade Centre, Bengaluru. The 4th India-Russia Business Dialogue was organized in Moscow in October 2012 by the ‘Business Council for Cooperation with India, Moscow’ and ‘Indian Business Alliance, Moscow’. Deputy PM Rogozin led a large Russian business delegation to the 18th India-Russia Inter-Governmental Commission on Trade, Economic, Scientific, Technological and Cultural Cooperation in New Delhi in October 2012. The 6th India-Russia Trade and Investment Forum was held on its sidelines. Special efforts were also made to develop trade, cultural and other ties between India and Russia’s regions, with visits undertaken in 2012 to Bashkortostan, Irkutsk, Kursk, Tatarstan, Leningrad and Sverdlovsk Regions, Primorskiy Krai, and Chuvash Republic. 

Such efforts have contributed to the healthy growth in our bilateral trade in 2012 and provide grounds for optimism. If this year’s trade growth pace is maintained till 2015, then the $20 billion target would be achieved in that year. 

RIR:  WhatpossiblebilateralenergyprojectsareinterestingforIndia? 

The energy sector illustrates our strong complementarities. Russia is a major energy producer, while India is one of the fastest growing energy consumers. We are implementing the Inter-Governmental Agreement on Cooperation in Hydrocarbons signed in 2010. 

ONGC Videsh Ltd’s largest investment abroad (Sakhalin-1 and Tomsk) is in Russia and the most oil it receives in return from such foreign investments is also from Russia. It is exploring investment opportunities in oil and gas via equity participation in projects in Siberia, Russia's Far East and the Arctic Shelf, with companies such as Rosneft, Gazprom, and Novatek. 

To meet our growing LNG requirements, Gas Authority of India Ltd signed a long term LNG Sales and Purchase Agreement on October 1, 2012, with a wholly-owned subsidiary of Russia’s Gazprom for the supply of 2.5 million metric tonnes of LNG per annum, for twenty years starting 2018-19. 

As regards civilian nuclear energy, Kudankulam Unit 1 has been completed and will be commissioned soon. The completion and commissioning of Unit 2 during 2013 is being expedited. The financial Protocol for state credits for construction of Kudankulam Units 3 & 4 was signed in July 2012 and both sides have agreed to swiftly conclude negotiations on the Techno-Commercial Offer for those two units. We are committed to implementing the 2008 India-Russia agreement on nuclear power cooperation and the 2010 Road Map on construction of Russian designed nuclear power plants in India. We will incorporate the best technology in our nuclear power plants to maintain the highest safety standards. 

RIR:  IftheSistemaShyamTeleServicessituationturnsoutbadlyforthecompany,willitaffectRussianinvestmentsinIndiaandIndianinvestmentinRussia? 

Agreements signed during the 13th Summit demonstrate the positive sentiments in Russia for investing in India and vice versa. They include documents for setting up a $2 billion investment fund as well as for major investment in joint ventures to manufacture Russian helicopters in India and Indian pharmaceuticals in Russia. Even more so, NIS-GLONASS, a company that is itself 70 percent owned by Sistema, has signed two forward looking documents during the 13th Summit, reflecting its enduring aspirations to be active in India. Meanwhile, the court hearing on Sistema’s curative petition filed before the Supreme Court of India is due shortly. 

RIR: Whatisbeingdoneindevelopingtiesbetweenprivatebusinessesinterestedincarryingoutjointlong-terminvestmentprojectswithminimalstateparticipation? 

The SBI-RDIF MoU envisaging funding of investments up to $2 billion will facilitate joint long-term investment projects. We hope it will also encourage private businesses on both sides to be less risk averse. Their caution is partly due to lack of sufficient exposure to each other's changed situation and latest achievements. As a result, we are often bound by old images and stereotypes. We will continue to make Russian companies more aware of our capabilities and more responsive to opportunities in India, and vice versa. 

In April 2012, a Russia-India Trade House with offices in both countries was set up by the private sector. It will disseminate business information, enhance awareness about trade/investment opportunities, and provide a platform to identify potential business propositions in Russia and India. Four sectors will receive special focus, viz., infrastructure, pharmaceuticals, life sciences and bio-technology. The Trade House will also organize seminars and workshops to apprise potential market entrants about doing business in Russia or India and identify new avenues of cross regional cooperation. 

RIR: How do you view the prospects of India-Russia military cooperation given India's increasing inclination towards the West in procuring defence equipment? 

Defence has long been an important pillar of our strategic partnership. The stiff competition that Russian arms manufacturers face from arms producers of other countries on the Indian market has been around for decades, and our defence ties with Russia have grown nonetheless. Russian manufactures have not succeeded in some of our recent defense acquisition programs, but that too is not unusual. Equally, there are many instances when Russian companies have proved competitive and emerged as valued partners in meeting our defence requirements. 

Our defence cooperation with Russia is multifaceted. Thus, we manufacture T-90S tanks, SU-30MKI fighters, and other equipment in India. In August 2012 we signed a MoU for a Joint Venture to manufacture “SMERCH” rockets in India. We also conduct joint exercises, such as the 4th ‘INDRA’ exercise by our armies in Buryatia, Russia, in August 2012, and the joint naval exercise ‘INDRA’ held off the Mumbai coast in December 2012. We also induct Russian weapons and equipment, and during 2012 this included the Mi-17 V5 helicopter into the Indian Air Force, and INS Chakra and the frigates INS Teg and INS Tarkash into the Indian Navy. Incidentally, both these frigates have some India made equipment on board, besides being equipped with BrahMos missiles

More importantly, in recent years our defence ties have radically transformed from a buyer-seller relationship to one involving joint research, design, development, and production of advanced defence systems and platforms. The BrahMos supersonic missile project was an early illustration of this fundamental shift, while the Fifth Generation Fighter Aircraft (FGFA) project and now the Multi-role Transport Aircraft (MTA) project are more recent examples of it. We signed the MTA General Contract in May 2012 and its Preliminary Design Phase Contract in October 2012. The BrahMos, FGFA and MTA projects are fine examples of what we can do together and provide compelling evidence that our mutually beneficial military-technical cooperation, based on trust and confidence, is progressing well. Overall, ours is a dynamic and growing defense partnership, not a waning one. 

RIR:  Willhumanitariantiesbetweenthetwocountriesstrengthen?Whatarethekeyelementsofculturalexchangesprogrammefor20132015signedduringPutinsIndiavisit? 

They will certainly strengthen. Besides annual festivals held alternately in India and Russia and extensive cultural interaction, 2012 was remarkable as we celebrated the 65th anniversary of India-Russia diplomatic ties, which saw numerous academic and cultural events hosted across both countries. 

The Cultural Exchange Programme for 2013-15 envisages bilateral cultural exchanges encompassing performing arts, art exhibitions, films and literature, cooperation between theatres, archives, libraries, and museums, and the organization of cultural festivals, besides seeking to preserve and promote the Roerich legacy. 

RIR:  WhatrolecouldIndiaandRussiaplayinAfghanistanafterNATOwithdrawsitstroops? 

India’s shared history with neighbouring Afghanistan goes back many millennia. Our unique ties are based on historical and civilisational linkages and cover areas such as political and security cooperation, trade and economic linkages, capacity development, educational, cultural and people-to-people ties. They have been strengthened by India's role in the reconstruction of Afghanistan through building indigenous capacity and institutions. India and Russia are concerned about the post-2014 scenario there and support Afghanistan as it completes a crucial transition by 2014 as well as in the post-transition era. We would like to see a normal situation in Afghanistan, permitting its peaceful development and acknowledge that regional cooperation and connectivity can assist in Afghanistan’s progress.We have similar positions as Russia on the situation in Afghanistan and see terrorism as the main threat to its security and stability, which in turn endangers regional and global peace and security. There is growing appreciation of the important role played by the neighbouring states of Afghanistan and organizations of the region, and that the emphasis needs to be on promoting regional cooperation structures, like SCO, CSTO and SAARC, to address the challenge of terrorism, including by dismantling their safe havens and disrupting their financial support. Our future cooperation could also further encourage collective action against producers and traffickers of illegal narco-drugs, which are the major source of terrorist funding. We could help promote investments into Afghanistan, building on the outcome of the June 2012 Delhi Investment Summit on Afghanistan. 

RIR:  WhatbilateralbusinesscooperationIndiaconsidersimportantinCentralAsia?IsthereanyprogressindevelopingtransportlinksbetweenRussiaandIndia(North-SouthInternationalTransportCorridor)? 

India’s total trade of $500 million with the five Central Asian countries is well below potential. Our ‘Connect Central Asia’ policy envisages development partnerships, capacity building and strengthening of cultural ties and people-to-people contacts. There is much potential for India’s technology and services sector to make deeper inroads into Central Asia. 

The proposed North-South Corridor will link Mumbai with Moscow and St. Petersburg through Iran and aims to streamline and reduce transport costs and travel time between India and the Eurasian region by up to 40%. We convened a meeting on this issue in May 2012 in New Delhi and are happy that some progress was achieved at it. We are interested in expediting this project on which follow-up is due this year. 

RIR:  Whatarethekeyareasof ourinternationalcooperation?WhatIndiaexpectsfromRussiainitswishtocarveoutforitselfamoreimportantplaceintheinternationalpoliticalarena? 

Russia and India have been trusted partners at international fora for decades. We have cooperated in the UN, BRICS, RIC, G-20 and other configurations and were happy to welcome Russia as a full-fledged WTO member last August

Our countries believe that international efforts to address global threats and challenges should be based on the rule of law and anchored in the UN Charter. We recognize the need for UN Security Council reform to make it more representative and effective in dealing with emerging challenges and agree that any Security Council expansion should reflect contemporary realities. In this context, Russia has expressed its strong support to India for a permanent seat in a reformed UN Security Council. It also supports India’s membership of the Nuclear Supplier’s Group, backs India as a full-fledged SCO member, and welcomes India’s intention to join APEC. We are happy to see Russia Chair the G-20 and look forward to working with it during 2013. India is interested in permanent observer status of the Arctic Council for which we count on Russia’s support. 

Both countries also believe there can be no justification for international terrorism. We strongly condemn those who provide safe havens to terrorists and are convinced that States that aid, abet, finance or shelter terrorists are as guilty of acts of terrorism as their actual perpetrators. India and Russia also reaffirm the central UN role in combating international terrorism and urge early adoption of the UN Comprehensive Convention on International Terrorism.

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