Russian President Vladimir Putin’s visit to New Delhi has put renewed focus on a central challenge facing the India-Russia partnership: how to transform a strategically strong relationship into a more balanced economic one.

India and Russia remain closely connected through defence and energy, but their rapidly expanding trade has been heavily driven by Indian purchases of Russian commodities. As the two countries pursue a target of USD 100 billion in bilateral trade, the question is whether manufacturing, technology, aviation, nuclear cooperation and Indian exports can narrow the existing imbalance.

Modi And Putin Review Expanding Partnership

During their bilateral meeting on the sidelines of the BRICS Summit, Prime Minister Narendra Modi and Putin reviewed cooperation across political, economic, defence, energy, space, skills and people-to-people ties.

The two leaders also welcomed INNOPROM India, a Russian industrial exhibition held in India for the first time between September 9 and 11, and highlighted its role in expanding industrial and commercial cooperation.

The focus on the exhibition reflected a wider effort to move the economic relationship beyond a model centred largely on Russian energy supplies and defence equipment.

For New Delhi, a key objective is to identify sectors in which Indian exports can find a larger market in Russia while encouraging Russian companies to establish manufacturing operations in India.

Trade Growth Remains Heavily Skewed

ITPO Chairman Javed Ashraf, speaking at CNN-News18 BRICS Dialogues, said Russia continued to be an important strategic partner for India, but the economic relationship required greater balance.

India has identified products that could be exported to Russia in larger quantities, he said, while Russian companies with technological capabilities could also benefit from manufacturing in India.

Such an arrangement could allow Russian firms to use India’s skilled workforce and large domestic market while reducing their dependence on China for certain imports.

India and Russia are targeting USD 100 billion in bilateral trade, but the current trade basket remains heavily tilted towards Russian exports to India.

The challenge, therefore, is not simply to increase the overall value of trade. India is seeking a broader relationship in which Russian demand for Indian goods grows substantially.

Increasing bilateral trade primarily through additional purchases of Russian energy would not address the diversification that New Delhi is seeking.

INNOPROM Highlights Manufacturing Push

INNOPROM India provided a window into the type of industrial relationship both countries are seeking to develop.

Held in New Delhi from September 9 to 11, the exhibition brought attention to opportunities in manufacturing, technology and industrial partnerships.

The broader objective is to encourage Russian technological and industrial capabilities to combine with Indian manufacturing capacity, skills and market access.

This approach would represent a shift from a relationship dominated by the trade of commodities and defence platforms towards one involving greater joint production and industrial cooperation.

Aviation Offers Scope For Technology Transfer

Civil Aviation Minister Ram Mohan Kinjarappu, speaking at CNN-News18 BRICS Dialogues with journalist Shawan Sen, said India was aiming to manufacture its first civilian aircraft by 2028.

He said Russia had also shown interest in manufacturing aircraft in India and referred to plans for a joint venture involving the Sukhoi Superjet.

India is seeking technology transfer through such partnerships, Kinjarappu said.

Aviation could therefore offer an example of how Russian technology and Indian manufacturing capabilities could be combined to create a new economic dimension in bilateral relations.

Nuclear Cooperation Goes Beyond Traditional Trade

Civil nuclear cooperation is another area where the relationship already extends beyond the conventional framework of oil and defence.

India and Russia have maintained a long-standing partnership in the civil nuclear sector.

Ashraf said during the CNN-News18 discussion that Russia was the only one among the three countries with which India had originally envisaged civil nuclear cooperation following the NSG exemption to have made substantial progress with New Delhi.

He said the two countries were looking at further areas of cooperation, including support across the nuclear fuel cycle.

The Modi-Putin meeting also included discussions on energy and space, with both sides agreeing to remain engaged in strengthening their “Special and Privileged Strategic Partnership”.

Russia Needs To Become A Bigger Market For Indian Goods

While sectors such as nuclear energy, aviation and space offer possibilities for deeper technological cooperation, the larger economic challenge remains trade.

Sputnik News’ Evgenii Pavlov, speaking to Shubhangi Sharma of CNN-News18 Special Projects at CNN-News18 BRICS Dialogues, said the India-Russia trade deficit was being addressed and pointed to opportunities for greater Indian exports.

However, he said India would need to focus on producing goods for which there was genuine demand in the Russian market.

That distinction remains central to the effort to rebalance bilateral trade. The issue is not only whether India can export more, but whether Russia can emerge as a significantly larger and more sustainable market for Indian products.

Joint Ventures And New Financial Mechanisms

Both countries are also exploring greater manufacturing cooperation and joint ventures as part of efforts to broaden the economic relationship.

Discussions on expanding trade have also included the possibility of an eventual free-trade agreement with the Eurasian Economic Union.

Ashraf said such an arrangement could potentially provide Indian companies with access not only to the Russian market but also to a wider Eurasian economic space.

There is also a financial component to efforts to expand bilateral commerce. Bloomberg has reported that Russia’s Sberbank is working with the Reserve Bank of India on a mechanism involving digital currencies for bilateral trade settlements.

If developed, such arrangements could make cross-border payments faster and more efficient at a time when both countries have had to operate within a complicated international payments environment.

Beyond Oil, The Test Is Economic Balance

The emerging economic agenda between India and Russia now extends well beyond oil and defence.

It includes manufacturing, technology transfer, civil nuclear cooperation, aviation, space, trade diversification, financial mechanisms and access to wider markets.

Yet the underlying challenge remains unchanged. For the economic partnership to become more balanced, Russia will need to buy significantly more from India.

Whether the initiatives discussed around Putin’s Delhi visit can help create that shift may ultimately be the more consequential test of the next phase of the India-Russia relationship.

Long or Short, get news the way you like. No ads. No redirections. Download Newspin and Stay Alert, The CSR Journal Mobile app, for fast, crisp, clean updates!

App Store –  https://apps.apple.com/in/app/newspin/id6746449540 

Google Play Store – https://play.google.com/store/apps/details?id=com.inventifweb.newspin&pcampaignid=web_share