TRADE AND INVESTMENT DYNAMICS OF INDIA AND RUSSIA – 2023

by Tradeimex Solution Import Export

SYNOPSIS

India and Russia are the two big nations of the world that although, don’t share any common grounds for doing international trade but are still connected and share the same thinking when it comes to the geopolitical factors that are related to international trade practices. Russia and India both share a common belief in the fact that the dominance of Western nations to use economic sanctions for their own political problems should be removed.

Practical applicability is the factor that paves the way for the economies of both nations toward success. This has been proved by India by playing safe with mindfulness when all Western nations were protesting against Russia to boycott all trade services with it as a penalty for invading Ukraine.

WHY DO INDIA AND RUSSIA NEED EACH OTHER?

The fact that why trade and investment relations are building between Russia and India are the advantages that are enjoyed by both nations due to the other. As we know that Russia is home to huge energy and power resources like mineral fuels and oils, meanwhile India is the largest consumer of these items because of the various development projects going on in the country every now and then. So, this becomes a mutually beneficial deal for both nations as Russia generates revenue by exporting its products and India can fulfill the demand of its citizens and escalate the completion speed of developmental and infrastructural projects.

India is on the lookout to fetch some of the best Russian technological partners to boost its technology, equipment, and tools that can prove to be more efficient in boosting the development and infrastructural projects in the nation.

MAJOR INVESTMENTS MADE

· The biggest oil companies in India, namely ONGC Videsh Ltd, Indian Oil, and Bharat Petroleum have already invested a total of USD 16 billion in Russian projects like Sakhalin-1, Imperial Energy, and Vankor Oil and gas field.

· ONGC Videsh has close to 21% in the Russian Sakhalin-1 project.

· India’s most prominent companies such as ExxonMobil and BP, who exited from the Western market, are again interested to reinvest in the Russian energy players.

· India has invested USD 35 billion in the Russian pharmaceutical sector.

BILATERAL TRADE INSIGHTS OF RUSSIA AND INDIA

Refer to the table below that contains the total bilateral trade between India and Russia as per Russia Trade Data that happened in the years between 2017-2021.

BILATERAL TRADE BETWEEN RUSSIA AND INDIA (2017-2021)
YEAR	RUSSIA > INDIA	INDIA > RUSSIA	TOTAL TRADE
2017	USD 7.97 billion	USD 2.13 billion	USD 10.1 billion
2018	USD 6.82 billion	USD 2.33 billion	USD 9.15 billion
2019	USD 6.22 billion	USD 2.87 billion	USD 9.09 billion
2020	USD 5.93 billion	USD 2.55 billion	USD 8.48 billion
2021	USD 8.69 billion	USD 3.33 billion	USD 12.02 billion

On analyzing the Russia Trade Data statistics of the past five years, the exports from Russia as registered in the Russia Export Data report for the year 2021 were the highest amongst all five years and when compared to the year 2020, they were more by USD 2.76 billion or by 46.5%. Similarly, in studying the Russia Import Data report for the year 2021, we got to know that imports to Russia from India went up by USD 0.78 billion or 30.5%.

In 2021, Russia became India's 7th biggest trade partner. From its initial days, Russia exported energy-generating products and power items like mineral fuels and oils to India in abundance. Due to some strict Western trade policies, the contribution of these items touched 84% of total Indian Imports.

Major items imported by Russia from India as per the Russia Import Data report for the year 2021 were pharmaceutical products, electrical appliances and gadgets, machines, organic chemicals, and iron and steel. On the other hand, major products exported by Russia to India as per the Russia Export Data report for the same year were mineral fuels and oils, natural and precious stones, fertilizers, animal fodder, and inorganic chemicals.

CONCLUSION

At present, the future of this bilateral trade between India and Russia seems quite successful as the imports and exports to and from each nation are rising every year. Currently, Russia is facing multiple restrictions and sanctions on its international trade because of the invasion that it made of Ukraine, but India seems importing crude oil and petroleum from Russia at cheap rates.

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