Even as the Russian military action continues in Ukraine, later this week, Russian Foreign Minister Sergei Lavrov is expected to visit India and is expected to meet his counterpart. According to sources, the focus of talks will of course be on currency swap, expected delay in the delivery of military equipment and spare parts from that country, the impact of the Western sanctions as well as crude supply.

This will be the first ever visit of a top Russian official since the war was declared by President Vladimir Putin over Ukraine on February 24, and since then there have been several rounds of telephone calls between the top leadership of both countries. The Russian Foreign Minister has also met with India’s Ambassador Pavan Kapoor in Moscow.

Several top ministers of various countries have been visiting India over the last few days in an effort to convince India to change its position against Russia.

Critical issues on the agenda

According to sources when the Russian Foreign Minister is here the focus is going to be on the impact of the ongoing military action in Ukraine, payment mechanisms to be addressed in view of the Western sanctions against Russian banks and its exclusion from the SWIFT; crude supply from that country at discounted price, delay in the military equipment and kits.

To discuss the mechanism of the currency swap the Russian Central Bank or Bank of Russia and the Reserve Bank of India are expected to have a meeting later this week.  The focus of the talks are expected to be on ensuring the timely deliveries of the S-400 Air Defence System for the Indian Air Force (for which the next tranche of payment has to be made) also some Ak-203 assault rifles that are expected to arrive for the Indian Army, the payment has to go. And there are several pending deals between the two countries for military platforms that are in the advanced stages to be firmed up; the officials will discuss the formalities to be completed for their payments.

Ahead of the Russian Foreign minister’s New Delhi visit, the new ambassador of Russia Denis Alipov has already had meetings with senior officials in the Ministry of External Affairs (MEA) including Secretary (Economic Relations) Dammu Ravi,  Secretary (West) Sanjay Verma,  and Secretary (East) Saurabh Kumar.

Expected visits later this week

As has been reported the earlier, the UK Foreign Secretary Liz Truss and Mexican Foreign Minister Ebrard are going to be in New Delhi this week. Also ahead of the Israel Prime Minister Naftali Bennet’s visit over the weekend, the defence minister of that country Benny Gantz is coming too.

India has been abstaining itself from all resolutions in the United Nations and has been urging both Russia and Ukraine to resolve issues through dialogue and diplomacy.

On the ongoing Russia-Ukraine crisis, last week, external affairs minister Dr S Jaishankar had said in Parliament, “We have expressed deep concern at the worsening situation and called for immediate cessation of violence and end to all hostilities.”
India-Russia Annual Summit

Prime Minister Narendra Modi is likely to visit Moscow for the India-Russia annual summit later this year. Later this year PM Modi is expected to travel to Russia for the annual India Russia summit.

And before that the defence minister Rajnath Singh and external affairs minister Dr S Jaishankar will travel to Moscow for the second round of 2+2 Ministerial Dialogue.

Currency Swap

Due to the Western sanctions imposed on the Russian banks and exclusion from the SWIFT,  India and Russia are expected to have currency swaps in place to finance trade in rupees and rubles.

Under the supervision of the Reserve Bank of India, according to reports, several Indian banks are going to execute the swap system. The Russian and Indian sides had already decided on the rupee-ruble payment mechanism for the S-400 Air Defence System for the Indian Air Force.

If the currency swap agreement is implemented then this would be the first time that dollar based system is being replaced in trading.