Last week?s state visit by president Dmitri Medvedev of Russia not only outlines an emerging pattern within Bric?s Asian jigsaw, it also highlights the value accorded by Moscow to its position of a mentor vis-a-vis New Delhi. That, doubtless, is the concern which ensured that president Medvedev?s state visit went ahead as scheduled, from December 4.
The visit was brief, but the preparations were thorough. So, although the range of bilateral, regional and global issues was wide, the two leaders did their best to strengthen the old lines of cooperation and update them to suit 21st century realities. They accordingly reiterated their commitment to a multi-polar world, discussed terrorism and the global financial crisis, and weighed the significance attaching to the nuclearisation of Iran. They also did their best to lay the groundwork for trilateral cooperation between India, Russia and China, and the reform of leading international institutions.
President Medvedev?s visit was also significant because it followed hard on the heels of the 26/11 terrorist attack on Mumbai. Medvedev has been the first head of state, or government, to visit India since 26/11. That is the first, and most important, distinction: Of equal importance (in this context) is the extensive shopping-and-synergy list agreed to by both sides. President Medvedev even pledged to support India?s fight against terrorism following last week?s Mumbai attacks.
That also explains why the list of cooperation contains items which relate to the development of India?s abilities to counter terrorism, plus attain higher electricity generation targets. That is what civilian nuclear cooperation is expected to be all about.
Cooperation in the energy sector is an important area in Indo-Russian bilateral relations. ONGC-Videsh Ltd has acquired 20% stake in the Sakhalin-I oil and gas project in the Russian Federation and has invested about $1.5 billion in the project. Russia?s Gazprom and India?s GAIL are also jointly developing a block in the Bay of Bengal.
Another good example of nuclear cooperation between India and Russia is the Kudankulam Nuclear Power Project. With two units (and a combined capacity of 2,000 mw) it is a good example of Indo-Russian nuclear cooperation. Both sides have expressed interest in expanding cooperation in the energy sector.
The Russian firm concerned will most likely be the state-owned (and run) nuclear power construction company, Rosatom. Once that power comes on-stream it will enable rural electrification and sustained load factors?both of which will be beneficial to host, as well as spread out industry.
Meanwhile, both sides have also committed themselves to active cooperation in the reform of international financial institutions, plus other positive-sum undertakings. The philosophy, and modus operandi for that is detailed, and summed up, in the joint declaration between the two countries.
Consequently the Russian Federal Financial Markets Service and India?s Securities and Exchange Board have signed a MoU which?according to the Russian regulator?aims at improving the efficiency of financial market coordination in both countries, as well as at strengthening cooperation in the exchange of information.
Russia has already signed similar memorandums with Brazil and China. And the agreement with India will allow it to fashion a unified stance towards financial market regulation within the Bric group. In fact, the MoU between the Russian Federal Financial Markets Service and India Securities and Exchange Board is in the nature of an agreement which aims to improve the efficiency of financial market coordination in both countries, plus strengthen cooperation in the exchange of information.
As for how good a fit are the two (erstwhile centrally planned) economies, para 5 of the Joint Declaration notes that there are a great number of complementarities between them. Also, there is an element of self-congratulation in phrases which note that ?The increasing competitiveness of Indian and the Russian companies in the world market??is something that is seen to be helping in the ?opening up of the two economies?. It is also suggested that such complementarities have been helping the two ?to launch themselves successfully in each other?s markets?.
No wonder there has been an accelerated opening up of representative branch offices in the two economies. That has been happening both within the Russian Federation and Russian enterprises in India. The joint declaration rightly calls it a healthy indicator of bilateral economic cooperation.
But the grandest economic target for India and Russia seems to be the one that expresses a striving to raise the value of two-way trade to $10 billion. Yet, even that does not seem to be infeasible, given that two-way trade this year is reported to be already crossing $7 billion.
In short, the ties between India and Russia have always been strong, and are developing even further. Also, it is quite understandable why PM Manmohan Singh characterises India?s strategic partnership with Russia as ?a vital anchor of India?s foreign policy?.
?The author is a fellow at the Maulana Abul Kalam Azad Institute of Asian Studies