Strong India-Russian Bond Widens

Updated: Nov 17 2003, 05:30am hrs
Contrary to some expectations, the visit of Prime Minister Atal Behari Vajpayee to Moscow last week was anything but routine despite this being his fourth meeting with Russian President Vladimir Putin in less than a year.

On the political front fears were belied that Russia may dilute its position vis-a-vis Pakistan, given its current efforts to normalise relations with Islamabad. The joint declaration issued at the end of the visit called for an end to cross-border terrorism and dismantling of terrorism infrastruc- ture in Pakistan. Russia unequivocally supported Indias steps to reduce tension in Kashmir and reiterated that the dispute should be resolved bilaterally based on the Shimla agreement and the Lahore declaration. India, similarly, extended full support to Russia on Chechnya. The two sides also declared their opposition to double standards in fighting terrorism and demanded the full implementation of UN Resolution 1373 in this regard. The joint declaration, which some officials described as a document for the 21st century, reflects the virtually identical views Russia and India have on a range of international issues, including Iraq, Afghanistan, restructuring the United Nations and building a multi-polar world. This emphasis on multilateralism as well as on double standards in fighting terrorism is clearly intended to convey the disappointment of the two countries with the current policies of the US. The feel good factor that was generated by the common ground forged on political and international issues clearly spilled over into other areas like scientific and technological cooperation, and military ties, and economic relations.

One of the major successes of the visit has been the agreement on space research and the supply of Indian satellites for a European navigation system the Russians are setting up. The agreement calls for India to supply six to eight satellites for the Glonas navigation system. This agreement is a clear boost to the Indian aerospace industry and an announcement of its coming of age. The decision to grant the contract to India was made on a purely commercial basis, another indication about the viability of this industry in India.

Similarly, the military relationship is also likely to witness a qualitative change from a buyer-seller relationship to one of joint development and production. The acquisition of the aircraft carrier Admiral Gorshkov and the systems that go with it, including the aircraft that will be based on it, are likely to be the last big-ticket purchases by India for some time. Therefore, to sustain the relationship well into the 21st century, joint development, and production of military hardware is envisaged. The systems thus developed will also be jointly marketed. As a start, Russia and India have agreed to jointly develop a fifth-generation fighter aircraft. This project is to be implemented by the Russian design bureau Irkut and Hindustan Aeronautics Limited. This agreement is significant because there was speculation for some time that the Russians may join hands with the French for this project. The Brahmos supersonic cruise missile project is currently an example of successful joint development of cutting edge military hardware.

There were several interesting developments during the visit, which have a direct bearing on the bilateral economic relationship. Most significant is the understanding reached on evolving a joint energy security policy. India has already invested heavily in the Sakhalin II project and is reportedly looking at acquiring stakes in more oil projects, including in Central Asia.

Other developments included the CII finally opening its office in Moscow. In addition, the SBI-Canara bank joint venture got its licence to open an office in Moscow. The Export Credit Guarantee Corporation and Russias Vnesheconom bank reached an agreement.

After a long hiatus, there were also some interesting developments at the private sector level. The Mahindras announced the opening of a retail outlet in Moscow as well as their intention to produce cars in Russia. Industry sources say that this will require an investment of about $500 million. Indias BEL and Russias SYSTEMA announced their agreement to jointly bid for a $400 million telecom project in Russia. Several other MOUs are reportedly in the pipeline. If this momentum is kept up, the visit appears to have turned out to be just the kind of fillip that was required to provide a substantial boost to the economic relationship that was flagging of late. Bilateral trade registered a turnover of little over $1.4 billion last year, whereas the potential is many times higher.

Reflecting the renewed geo-political understanding with Russia, Vajpayees second leg of his foreign tour took him to Tajikistan, the Central Asian republic that Moscow considers its legitimate sphere of influence. The PMs visit to Dushanbe was undoubtedly overshadowed by recent exaggerated reports about an Indian military base in Tajikistan. The facts are that India is involved in a multi-crore project to revamp the airport at Ayni. Independently of that India provides training to Tajik armed forces and has conducted some joint exercises. However, these facts do not necessarily add up to a military base. Also, India is yet to acquire any interest in the Kurmangazi oilfields. Nevertheless, all this must not detract from the significance of Vajpayees visit to Tajikistan, the first ever by an Indian Prime Minister. It is a clear reiteration of Indias interest in the region, which is potentially a huge untapped market for India.

Again, it needs to be said that the government can only do a limited amount. Indias interests in the region can be best promoted only by greater private sector involvement. If that grows to a sufficient level then maybe, Ayni may actually be considered a place suitable for an Indian military base.

The writer is a freelancer specialising in Russian foreign affairs