Russian Prime Minister Victor Zubkov, who arrives in New Delhi on February 12, is leading a delegation of over 150 CEOs for a two day visit that is expected to deepen trade and investment ties between the two countries.
The two countries are expected to enter into collaborations in the area of mining and metallurgy, telecommunication, chemical, heavy equipment and others during the visit. Zubkov is scheduled to inaugurate a branch of the Vneshtorgbank Bank in New Delhi, the second largest public sector bank of Russia. Russian conglomerate JSFC Sistema, which is set to be awarded nation-wide mobile licences through its joint venture with Shyam Telelink group, is also opening an office in the city during the visit.
Zubkov's visit follows Russian President Vladimir Putin's visit last year, when the two countries decided to broaden co-operation in the area of civil nuclear energy, defence, space and trade.
Since then, a new agreement to utilise the rupee-rouble debt has been finalised, while negotiations on the price of refitting Admiral Gorshkov, the Russian aircraft carrier which India has purchased, are underway.
"The major concern is flow of investments, as India's share in Russian trade is insignificant. Joining hands in the banking and financial sector is an important means to resolve this issue," Amit Mitra, secretary general, Federation of Indian Chambers of Commerce and Industry said.
According to a Confederation of Indian Industry paper on India-Russia relations, India has a meagre share of 1.06 per cent in the total Russian trade. "Russia has the potential to become India's next big trade and investment partner if the two sides decide to engage with each other and iron out the barriers to free flow of goods and services into each other's markets," the CII paper states.
"Given the problem of a short, dependable and cost-effective trade route, the two sides need to move towards high value-added products besides boosting the sagging trade in commodities that are traditionally traded between the two countries. They also need to focus on services trade," T S Vishwanath, head, international trade policy, CII said.
Industry expects Zubkov's visit will lead to the removal of some barriers. According to a Ficci survey, Indian exporters lamented that in absence of letters of credit they have to negotiate with their counterparts directly.
"Lack of transparent industrial policies post disintegration of the Soviet Union have created financial problems for Indian business in Russia," said Bipin Patel, partner, Unique Dyechem. "The Russian government should ask its companies to comply with international business norms," he added.
The Indian industry would also raise the issue about the recent ban on exports of agricultural commodities.
