Indian Producers ‘Actively’ Plugging Gaps Left by Western Corporate Exodus from Russia
16:14 15.06.2023 (Updated: 16:55 23.06.2023)
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Bilateral trade between India and Russia has surged to over $35 billion in 2022-23, breaching all previous records and surpassing the target set by the two governments. The surging trade has largely been due to an exponential rise in Russian crude exports to India, with Moscow now ranking as the biggest energy supplier to New Delhi.
Indian manufactures are “actively starting to enter” the Russian market and are looking for local business partners to forge joint ventures, the honourary representative of the Chamber of Commerce and Industry of the Russian Federation (CCI RF) in India, has told Sputnik on the margins of the 26th St. Petersburg International Economic Forum (SPIEF).
Igor Piasetskii, who flew from New Delhi to attend the premier, annual business forum, said that there is “demand” in the market on account of surging India-Russia business ties as well the exit of western companies from Russian in the wake of G-7 sanctions against Moscow.
“Many Indian partners are interested in production and supply of equipment such as bearings, drilling rigs and drilling tools. I want to say that India produces high quality drilling tools. And this is a niche that has now been vacated after the departure of a number of companies. And since we have a highly developed mining industry, there is a great prospect here,” Piasetskii stated.
He noted that a growing number of Russian business delegations have been visiting India to explore opportunities for collaborations in recent months, in what is a sign of bolstering business-to-business (B2B) ties.
Piasetskii said that a group of Russian businessmen paid a visit to Indian factories manufacturing drills equipment as recently as last week.
The Russian business chamber representative said that Indian companies could help fill the niches not only in the supply of drilling equipment, but also in the export of pharmaceutical products.
He said that several Indian companies were ready to localize production of drugs in Russia, based on certain guarantees.
“Those strategic drugs that they propose to localize will be very beneficial for the country,” Piasetskii underlined.
He further stated that Russian companies could also offer their technical expertise to Indian companies in order to “localize” production of certain items in India.
“For those who have previously exported their products to the EU countries, Canada, the United States, the rapidly growing Indian market will eat it all up,” the honorary representative said.
Piasetskii said that not only are Indian companies ready to localize production with their own finances, but products developed in India with Russian expertize could also be exported to third countries without the threat of sanctions.
He said that digital technologies as one of the strengths of India, adding that it also has a pool of software professionals such as programmers, and could be a potential supplier of high-tech personnel to Russia.
The Russian chamber representative expressed confidence that India, as the fastest growing major economy in the world, offered ample opportunities for joint partnerships to Russian companies.
On Streamlining Trade in Local Currencies
Amid record trade levels, New Delhi has flagged the “trade imbalance” in bilateral commercial relationship as an issue to be addressed.
Russian foreign minister Sergey Lavrov said at the margins of Shanghai Cooperation Organization (SCO) Council of Foreign Ministers (CFM) meeting in Goa last month that Russian companies have accumulated billions of Indian rupees in Indian banks which couldn’t be used due to western sanctions.
To overcome the issue, Piasetskii suggested that Russian companies should be use the Indian currency to buy necessary products from the Indian market.
“Thus, the rubles will remain here in Russia. And those rupees that have accumulated there will be used. And this, as I said, is all kinds of mechanisms, guarantees, even lending in rupees,” he said.
Piasetskii also reckoned that the Indian rupees could be invested in high-tech joint ventures and towards localizing production means in India.
“Thus, Russia’s share in joint companies will be increased. At the same time, an infrastructure is being created that looks at Russia. This would be our joint company,” the chamber representative said.
On Importance of International North-South Transport Corridor
Piasetskii underlined that the importance of the International North-South Corridor in the current geopolitical situation, saying that “cardinal changes” have been taking place in the global trading system.
He said that previously, European Union (EU) was considered as a “reliable” partner for Russia, which was geographically proximate that Asia.
“Now, each country subsidizes its own economy. Everyone is fighting for the survival of their economy. You cannot survive without B2B partners. It is necessary to form coalitions which take into account the national characteristics, culture and traditions. We need partners who do not use business relations to impose their values on other countries,” Piasetskii explained.
