Despite US pressure, India-Russia ties look at fresh avenues

Despite the latest threat by US President Donald Trump to widen the ambit of sanctions, India’s ties with Moscow seem poised for a fresh impetus as Russian President Vladimir Putin is expected to be in India in the first week of December.

Putin will meet Prime Minister Narendra Modi for the annual leader’s summit which the two countries host alternatively. The two would be looking to widen relations across sectors, including defence, nuclear power, commercial aviation and economy. In the run-up to Putin’s expected visit, top officials of both sides have been meeting regularly and ironing out the creases, if any.

In the past two days, External Affairs Minister S Jaishankar met his counterpart Sergey Lavrov in Moscow while National Security Advisor Ajit Doval met with Putin’s top aide and chairman of the Maritime Board of Russia, Nikolai Patrushev in New Delhi.

The upcoming Modi-Putin talks are set to focus on strengthening strategic ties while outcomes could relate to economic cooperation, commercial aviation and technology transfer, especially in military equipment. The talks are closely watched across the world for implications as India tries a balancing act between Russia, the West and China.

The summit signals a commitment by both nations to deepen their ‘special and privileged strategic partnership’ amid changing international alignments. Several bilateral agreements — across sectors — may be signed, giving a push to longstanding India-Russia ties.

* Trump indicates widening sanctions beyond oil

Trump’s latest statement, made on Monday, indicates the US could widen the ambit of sanctions beyond the penalties on purchase of Russian crude. Trump said any country doing business with Russia will be ‘very severely’ sanctioned and a legislation is proposed by lawmakers of his own party, the Republicans.

Fresh sanctions by US pose a threat to India-Russia ties in defence and nuclear energy.

India already faces 50 per cent tariffs, among the highest in the world, including 25 per cent levies for its purchases of Russian crude oil. India's position as the second-largest buyer shapes energy ties with Moscow and will be a central topic during any talks, especially in the wake of tightening Western sanctions.

India’s crude oil conundrum got complicated last month when US sanctioned Russian majors Lukoil and Rosneft. The ban takes full effect on November 21, with global buyers, including Indian firms, required to wind down transactions by that date or risk severe penalties.

New Delhi is being singled out for penalties. China, the largest importer of crude oil from Russia is not facing punitive tariffs while Germany, has got a waiver to work with two subsidiaries of Russian Rosneft based on its soil. India does not accept unilateral sanctions and imported Russian fossil fuels worth $3.4 billion in October. Indian refiners took in about 1.6-1.7 million barrels per day during October, maintaining a 34-38% share of all Russian crude exports.

* Dichotomy on India and Russia in US

The division within the US lawmakers over dealing with India could cushion some impact. Even as Republican lawmakers are pushing with a fresh tough legislation targeting Moscow, a bipartisan resolution has come up in the US Congress recognising the strategic value of the historical partnership between the United States and India.

US lawmaker Ami Bera, a Democrat and the longest-serving Indian American member of the Congress, along with Joe Wilson, a Republican, had introduced a resolution on Monday and is co-sponsored by 24 other lawmakers.

The resolution underscores decades of deepening cooperation between two of the world’s largest democracies across critical sectors, including defence, technology, trade, counterterrorism and education. The resolution, among other issues, recognises India’s growing energy needs as an essential component of its economic development, and applauds India for increasing its purchases of United States energy resources.

* Upcoming Defence ties

India and Russia are at the cusp of deciding multiple military equipment deals. New Delhi and Moscow are looking at expanding the range of the BrahMos missiles, upgrade the Sukhoi-30MKI fighter jet upgrades, add more numbers to the air defence missiles the S-400 and possibly making in India of the new stealth jet the Sukhoi-57E.

The two countries are discussing a ‘comprehensive defence agreement’, including an expanded logistics cooperation such as reciprocal access to each nation’s military bases and support facilities.

The Sukhoi-57E is a Russian fifth-generation fighter aircraft. A Russian delegation from the Sukhoi Design Bureau recently assessed HAL’s key facilities, including the Nashik division.

Separately, last month a Memorandum of Understanding (MoU) was signed between HAL and Russian United Aircraft Corporation (UAV), a sanctioned entity. The HAL-UAC partnership is to make the SJ-100 passenger jet in India.

* Labour mobility and banking

India and Russia are expected to sign a landmark bilateral labour mobility agreement. This looks to create a structured framework for the legal migration of skilled Indian manpower to Russia, protection of workers’ rights and expansion of their employment across key sectors such as construction, textiles, engineering and electronics.

The two countries have high-level dialogues to address banking challenges, facilitate smoother financial flows and boost deeper economic partnership, including towards a free trade agreement with the Eurasian Economic Union.