India-Russia Trade Surges, Addressing Imbalance Becomesโ Keyโฃ focus
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New Delhi – A importantโค expansion of trade relations โbetween India and Russia is underway, with both nations seeking โขto address a growing trade imbalance. External affairsโค Minister S.Jaishankar recently concluded a visit โฃto Moscow, where he proposed strategies to diversify โtrade and rectify the current deficit, which stands at $58.9 billion, largely due to increased Indian oilโ procurement from Russia.
Growing โEconomic Partnership
Bilateral trade between India and Russia has experienced considerable growth, reaching $68 billion by the fiscal year 2024-25, a fivefold increase in recent yearsโ [[2]].Russiaโ is now a keyโ trading partner for India, rankingโค fourth after the โฃUnited States, China, and the United Arab Emirates [[1]]. In terms of imports, Russiaโค holds the second โposition, trailing only China.
This surgeโฃ in trade is occurring against a backdrop of evolving global dynamics,with both countries seeking to โstrengthenโข economic ties self-reliant of Western sanctions.Russia has emphasized the importance of establishing paymentโข mechanisms using national currencies and fosteringโข independent transportation and logistics networks.
Addressing the Trade Imbalance
Minister Jaishankarโ highlighted the urgency of addressing the trade imbalance, proposing several actionable measures. These include tackling tariff and non-tariff barriers,streamlining โคlogistics,enhancing connectivity through key corridorsโฃ like the International North-South Transport Corridor,and finalizing the India-Eurasian Economic Union free Tradeโค Agreement.
“Theseโฃ measures will not only help to address the imbalance and grow our trade, but โฃalso hasten the timely achievement of our revised trade target of $100 billion by 2030,” Jaishankar stated during the India-Russia Inter-Governmental Commission for Trade, Economic, Scientific, technological and Cultural Cooperationโค (IRIGC-TEC) โคmeeting [[2]].
Did You Know?
The International North-South Transport Corridor (INSTC) aims to reduce freightโค costs and transit times between India and Russia by 20-30%โ by providing a shorter, more efficient route compared to conventional sea routes.
Key Trade Targets and Initiatives
The focus extends beyond โsimply increasing trade โvolume. Both nations are prioritizing the completion of the Program ofโฃ Economic Cooperation until 2030. Connectivity projects,โ including the Northern Seaโ Route and the โฃChennai-Vladivostok Corridor, are also beingโ activelyโข promoted to facilitate smoother trade flows.
| Year | India-Russia Trade (USDโ Billion) | % Change |
|---|---|---|
| 2020 | 11.4 | -17.4% |
| 2021 | 13.5 | +18.4% |
| 2022 | 30 | +122.2% |
| 2023 | 60.9 | +103% |
| 2024-25 (Projected) | 68 | +11.7% |
Geopolitical Context and Futureโ Discussions
The discussions between Jaishankar and his Russian counterpart, Sergey lavrov, also encompassed broader regional and globalโ issues, including the ongoing โขconflict inโค Ukraine. โฃLavrov is expected โto provide insights into the recent Russia-USโข summit. Theโ foundation of the relationship, according to the โคRussian Foreign Ministry, โrests โขon “mutual trust and respect.”
Pro Tip: Diversifyingโ trade beyond oil and defense will be crucial for India โขtoโ achieve a more balanced and enduring โฃeconomic partnership with Russia.
Both countries are committed to enhancingโฃ cooperation in key sectors such as transport, energy, agriculture, and scientific-technical fields. As โindia navigates a complex geopoliticalโ landscape, its strategic partnership with Russia remains a vital โฃcomponent โคof its foreign policy.
What impact will these initiatives have โon India’s energy security? and how will the evolving global political climateโ shape the future of India-russia trade?
The India-Russia relationship has deep historical roots, dating back to the Cold War era.โค Initially driven by Soviet support for India’s industrialization, the partnership has evolved โฃto encompass defense โคcooperation, energy security, and now, a growing economicโ relationship. The current surge in trade โคis partly a consequence of shifting global supplyโ chains and India’s needโ to secure alternative energy sources. looking ahead, the success of initiatives like the INSTC and the Eurasian Economic Unionโ FTA will be โcritical in sustaining this momentum.
Frequently Asked Questions about India-Russia โขTrade
- What is the current state of India-Russia trade? India-Russia trade has surged to $68 billion in 2024-25, a fivefold increase inโ recent years.
- what is the main driver of this trade growth? Increased Indian procurement of Russian oil is a significant factor,contributing to a trade imbalance.
- What โsteps are being taken toโ address the trade imbalance? โค measures include diversifying trade, streamlining logistics, and finalizingโฃ free trade agreements.
- What is the significance of the INSTC? the International North-south Transport Corridor aims to reduce freight costs and โtransit times between India andโ Russia.
- What are the key sectors of cooperation between India and Russia? Key sectors include energy,defense,transport,agriculture,and scientific-technical fields.
We hope this article โขprovided valuable insights into the evolving economic relationship between India and Russia. Pleaseโฃ share your thoughts inโข the comments below, and don’tโ forget to subscribe to our โคnewsletter for more in-depth analysis of global economic trends.