India Russia Far East Cooperation

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Relevance:

GS- 2 India and its neighborhood- relations

Context:

An MoU was signed between India and Russia to open a maritime route between Chennai and Vladivostok to ensure connectivity between the two countries. PM Narendra Modi has been invited as the Chief Guest of Eastern Economic Forum which will impetus to cooperation between India and the Russian Far East.

Background:

Recent Developments in India- Russia Relations

  1. Maritime Route: A proposal was made to have a full-fledged maritime route between Chennai and Vladivostok.
    • Vladivostok is at a short distance from Russia’s border with China and is also the largest port on Russia’s Pacific coast.
    • India is building nuclear power plants with Russia’s collaboration in Kudankulam on the sea coast in Tamil Nadu’s Tirunelveli district. The opening of a sea route is likely to help in the project.
    • It will also increase India’s presence in the Indo-Pacific, and especially the South China Sea, a deeply contested patch of the ocean.
  2. Special and Privileged Strategic Partnership: Both the leaders agreed to facilitate, in all possible ways, exploring the impressive potential of their strategic partnership to the fullest, while demonstrating the special and privileged nature of the partnership.
  3. Supported India’s decision on J&K: Russia has backed India’s move on Jammu and Kashmir, saying that the changes in the status are within the framework of the Indian Constitution.
    Both the countries underlined the primacy of international law and emphasized their commitment to the purposes and the principles stated in the UN Charter including the inadmissibility of interference in the internal affairs of member states.
  4. Development of Russian Far East: India would extend a $1 billion line of credit towards the development of the Russian Far East. Russia.s interest in accepting such a line of credit is the leverage it would provide in the tumultuous times of US Sanctions on Russia which may cause a US dollar shortage in the near future. An area of special interest for India is the exploration of hydrocarbon reserves along the coast of Russia’s Far East.
    Also, engaging closely with East Asia is in line with India’s policy goal of “Act East”.
  5. Collaboration in Space: Russia, would help train Indian astronauts for the manned space mission — the Gaganyaan project. Both sides expressed concern over the possibility of an arms race in outer space and advocated peaceful uses of outer space.
  6. Economic Cooperation: The two leaders decided to take the bilateral trade from the current $11 billion to $30 billion by 2025. The work on promoting mutual settlements of payments in national currencies will be continued.
    • Create new technological and investment partnerships, especially in advanced high-tech areas and find new avenues and forms of cooperation.
    • Agreed to speed up preparations for the signing of the India-Russia Intergovernmental Agreement on Promotion and Mutual Protection of Investments.
    • Agreed to intensify work for eliminating trade barriers. This would be facilitated, inter alia, by the proposed Trading Agreement between the Eurasian Economic Union (EAEU) and India.
  7. Military Cooperation: The talks highlighted that the sanctions imposed by the US on Russia have no effect on India's strengthening cooperation with the country in strategic sectors such as energy and defense.
    Both the countries are successfully implementing their bilateral program on military and technical cooperation up to 2020 and working to update the same to extend to another 10 years.
  8. Cooperation in International Issues:
    • Called for reform of the UN Security Council. Russia expressed its support for India’s candidacy for permanent membership of the UNSC.
    • Condemned terrorism in all its forms and manifestations and called on the international community to set up a united front to fight against this evil.
    • Reiterated their commitment to further strengthen global non-proliferation. Russia expressed its strong support for India’s membership in the Nuclear Suppliers Group (NSG).
    • Support an inclusive peace and Afghan-led and Afghan-owned reconciliation in Afghanistan.
    • Reaffirmed their commitment to building an equal and indivisible security architecture in Asia and the Pacific region.

Impact of cooperation between the Russian Far East and India:

Russian Far East is characterized by a huge geographic landscape that is very sparsely populated. It is a backward region of Russia. Far Eastern Federal District is twice the size of India and is rich in resources. Russia needs the help of Asian countries other than China to develop the region. Russia is keen to balance Chinese presence in the region by Indian investment and manpower. Also, as the European economies have been experiencing a long term economic slowdown, Russia is keen to invest and accelerate economic growth in its Far East which is closer to dynamic Asian economies.

  1. India’s Interest in Arctic Region:
    • India looks forward to co-operating with Russia in the Arctic. India has been following the developments in the Arctic region with interest and is also ready to play a significant role in the Arctic Council.
    • Give access to Northern Sea Route or Arctic Sea Route to Europe which will be the shortest sea route to Northern Europe for India.
  2. Russian Far East has a shortage of manpower. India can emerge as an exporter of skilled manpower in the region.
  3. Agriculture and lumbering:
    • Being very sparsely populated and as global warming leads to increasing of farming time in the region, Russia’s Far East can emerge as one of the most promising areas where farming can be extended in the future.
    • Also, the region has extensive forest resources which can provide softwood for supplementing India’s timber demands.
  4. Diamonds:
    • India is one of the most important diamond processing, cutting and polishing centres in the world. Russian Far East is one of the main regions where diamonds are mined in the world.
  5. Oil and Gas:
    • Russia is a reliable supplier of energy resources to the Indian market. Last year, about 2.3 million tonnes of oil, almost 550,000 tonnes of petroleum products and 4.5 million tonnes of coal were delivered to India. A substantial part of Russian hydrocarbon exports in sent to India from Russia’s Far East.
    • Indian partners own 20% in the Sakhalin-1 project. Russia has invited Indian companies to join other promising projects such as Far Eastern LNG and LNG-2.
  6. Mining
    • The region has extensive areas and mineral resources such as Coking Coal which India has a very limited quantity of.
  7. Tourism
    • Several Indian companies have been successfully set up in the Far East region, such as M/s KGK in Vladivostok in the field of diamond cutting and M/s Tata Power in Krutogorovo in Kamchatka in coal mining. The Russian Side welcomed the intent of the Indian Side to expand its economic and investment presence in the Far Eastern region and Siberia.

Other important announcements related to the Russian Far East:

  • The signing of an agreement between the two countries for protecting the capital investment in future.
  • Russian Far East Investment and Export Agency will open an office in Mumbai.



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