CII outlines plan to up trade with Russia to $5 bn by 2005

Rajeev Jayaswal

New Delhi, Nov 5: With the recent terrorist attacks expected to adversely affect the US economy, India Inc has started looking towards Russia as a major alternative market.

Confederation of Indian Industry (CII) has chalked out a comprehensive plan to increase bilateral trade between the two countries from $1.5 billion to $5 billion by 2005.

Some Indian companies have already initiated the process to set up their ventures in Russia or to forge business tie-ups with local companies, a senior CII official told The Financial Express.

Tatas and Mahindras have already signed joint venture agreements with Russian companies in automotive sector, he said adding that other Indian companies in information technology (IT), telecommunications, pharmaceuticals and defence sectors are exploring business opportunities.

CII has identified IT, telecom, energy, pharmaceuticals, bio-technology, training in IT and management, food processing, ayurveda, jem and jewellery, aircrafts and defence as key areas to have joint ventures with Russian companies.

When contacted, CII deputy director general S Sen confirmed that Russia is becoming one of the focus countries for Indian business.
Not only the industry but the Indian government has also signaled the need to further strengthen business relationship between the two countries. Prime minister Atal Bihari Vajpayee, who had cancelled all his foreign visits after September 11, continued with his plan to visit Russia. This reflects the positive attitude of the government not only in political realm but also in further strengthening business ties, he said.

There is a marked improvement in the Russian economy in the last two years. “Unless we take the initiative we will lose the edge,” he said, adding that the association will take various measures to promote trade relations with Russia to the level of $5 billion.

CII in collaboration with its Russian counterpart, Russian Union of Industrialist and Entrepreneur (RUIE), has re-opened its office in Moscow coinciding with Mr Vajpayee’s visit. It had closed its Moscow office after the disintegration of USSR.

The global attitude towards Russia is changing. Top investing countries in Russia includes the USA, the UK, Switzerland, Germany, the Netherlands, Cyprus, Australia, France, Japan, Monaco, Turkey, Finland and Sweden.

“We should not miss the bus. India shared great partnership with erstwhile USSR. But the bilateral trade between the two countries could not cross $1.4-1.5 billion mark. On the other hand, in less than one decade the bilateral trade with China reached to $3 billion. It shows that much can be achieved in terms of trade with one of the oldest friends of India with which it always shared a comfortable relationship,” Mr Sen said.