India looks to start free trade agreement talks with Eurasian Economic Union when Prime Minister Narendra Modi meets Russian President Vladimir Putin at a summit that will seek to inject new life into a relationship that has seen trade slump amid shifting global alliances.
The two leaders will meet tomorrow for the summit level talks for the second time in eight months and sign energy and defence deals to boost trade and economic ties. Sources said a joint study had been commissioned on the feasibility of a free trade agreement (FTA) between India and the Eurasian Economic Union (EAEU), and talks are on to decide on the timeframe for negotiations and components of the proposed pact.
Several measures, including an agreement on a free trade zone between the EAEU and India, are expected to help increase bilateral trade with Russia to $30 billion by 2025 from $6.17 billion in 2015-16. The Eurasian Economic Union includes Belarus, Kazakhstan, Russia, Armenia and Kyrgyzstan.
Commerce Minister Nirmala Sitharaman is part of the official delegation travelling with Modi to Russia. Also, the International North-South Transport Corridor project is likely to figure during talks. This is the first time the annual bilateral summit is being held outside Moscow since strategic partnership between the two nations was established in 2000. This partnership was later raised to the level of Special and Privileged Strategic Partnership and ever since Russia is the only country with which India has had annual summits.
The two leaders had last met in Goa in October 2016 when energy and defence deals worth billions of dollars were signed. Russia’s Rosneft signed a deal to acquire Essar Oil for $12.9 billion. Sources said Modi will have the standard restricted talks, delegation level talks followed by interaction with the CEOs Forum. A host of agreements is likely to be signed before the two leaders have a one-on-one dinner in the evening.
Modi will on June 2 participate in the St Petersburg International Economic Forum. In the run up to the Summit, Defence Minister Arun Jaitley visited Moscow in April followed by a visit by National Security Advisor Ajit Doval this month. Foreign Secretary S Jaishankar had visited Russia in March. Both are part of Modi’s delegation at the summit.
Sources said the two nations are looking at collaboration on International North South Transport Corridor for faster movement of goods at 40 per cent lower cost. The Eurasian Economic Union had in December last year agreed to launch FTA. Last October, four big ticket defence deals worth over USD 10 billion were inked in Goa. These included Russia supplying S-400 Triumf air defence missiles that it had previously exported only to China.