India-Russia Relations – Significance and Challenges – Explained Pointwise

What is the history of India-Russia Relations?

Russia has been a longstanding and time-tested partner for India. Development of India-Russia relations has been a key pillar of India’s foreign policy. It is pertinent to look at the historical development of India-Russia relations.

India and Russia (formerly the Soviet Union) have had a longstanding and strategic relationship since the establishment of formal diplomatic ties in April 1947, just months before India’s independence. The relationship has evolved over the decades, with periods of both cooperation and tension.

What are the areas of Cooperation between India and Russia?

1. Geopolitical Cooperation: India and Russia have close geopolitical cooperation:
   1. Engagement of India and Russia in regional forums like BRICS, SCO and the G20.
   2. India refrained from adverse voting in the UN, and disregarded Western threats of sanctions on its energy imports from Russia.
   3. India and Russia champion the establishment of a multi-polar world order.
   4. Strong condemnation of terrorism in all its forms and all terrorist “safe havens” by both the Countries.
2. Defense Cooperation:
   1. Military Hardware and Technology Transfers: Russia is a major defense equipment supplier to India:
      • Licensed production of T-90 tanks and Su-30 MKI aircraft in India.
      • Agreements for the supply of S-400 Triumf mobile surface-to-air missile systems, MiG-29K aircraft, Kamov-31 helicopters, and upgrade of MiG-29 aircraft.
      • Joint development and production of military platforms like the BrahMos supersonic cruise missile.
      • Establishment of Indo-Russia Rifles Private Limited (IRRPL) to produce AK-203 rifles in India under “Make in India”.
   2. Joint Military Exercises: Tri-service military exercise ‘INDRA’, Avia Indra joint air force exercise.
   3. Institutionalized Mechanisms for Defense Collaboration: Establishment of India-Russia Inter-Governmental Commission on Military Technical Cooperation (IRIGC-MTC) at the apex level; and 2+2 Dialogue mechanism involving the Defense and Foreign Ministers in 2021.
3. Economic Cooperation: India and Russia share close economic relations. These are explained below:
   1. Trade and Investment: The bilateral trade between India and Russia stands at around $65 billion. India’s imports of Russian crude at discount has surged in after the invasion of Ukraine led to the oil sanctions by the U.S. and Europe.
   2. Cooperation in the Russian Far East: India provides financial and personnel assistance to develop the resource-rich but sparsely populated Russian Far East region bordering China. A 5-year program of cooperation in the Far East for 2021-2025 is being finalized between NITI Aayog and Russia’s Ministry for Development of the Far East.
   3. Close Business Cooperation: India and Russia have both institutionalised CEO’s Forum. Indian companies invest in Russia, especially in natural resources such as coal, fertilizers, hydrocarbons, minerals, rare earth metals.
   4. Banking and Financial Links: India and Russia have explored on deepening banking and financial links such as ruble-rupee trade; and collaboration between financial institutions like SBI and VTB Bank.
4. Scientific and Research Cooperation: Since the cold war era, Russia has been a major scientific and research partner of India.
   1. Civil nuclear energy Cooperation: India and Russia jointly developed Kudankulam Nuclear Power Plant (KKNPP). India and Russia have jointly signed agreements on the construction of 12 nuclear power plants in India during the coming decades.
   2. Space relations: Russia and India have signed an agreement to train Indian astronauts for India’s first manned space mission (Gaganyaan). C-DAC and GLONASS have signed the agreement for cooperation in technologies based on satellite navigation.
   3. Health: India approved Russian Vaccine Sputnik V under emergency use authorization.
5. Diaspora and Cultural Relations: India and Russia have a deep diaspora and cultural relation. The following are the areas of engagement between India and Russia.
   1. Respect for languages and Culture: Hindi, and other languages such as Tamil, Marathi, Gujarati, Bengali, Urdu, Sanskrit and Pali are taught in Russian Institutions. Organizations like the Indian Cultural Centre in Moscow and the Indian Students’ Association promote Indian culture and heritage in Russia.
   2. Indian Diaspora: The Indian diaspora in Russia is estimated to be around 30,000-40,000, which consists of mostly professionals, students and businesspeople.
   3. Extension of line of Credit for Russian Far East: India has extended $1 billion as a line of credit for the development of the Russian Far East.

What is the significance of India-Russia Relations?

1. Geopolitical: Deepened strategic partnership with India holds a lot of geopolitical importance for India.
   1. Russian support on critical Issues: Russia supports India’s demand for permanent seat in the UNSC. It has also supported India’s stand on the Kashmir Issue.
   2. Counterbalancing Chinese Aggression: Russia can help in defusing rising tensions with China.
2. Defence and Security Cooperation:
   1. Russia still remains a critical defense supplier for India with 60-70% of India’s defense equipment estimated to be of Russian and Soviet origin. Though India has diversified its defense imports from countries like US, France, it still cannot alienate Russia especially in the face of Chinese aggression at the border.
   2. S-400 and other advanced systems bolster India’s air defense capability, even at the cost of friction with the US under CAATSA.
   3. Unlike many Western partners who often place strict end-user constraints, Russia has historically shared sensitive defense technologies, including nuclear submarine leasing, supersonic cruise missile systems (BrahMos), and licensed indigenous manufacturing capabilities.
3. Economic and Connectivity Opportunities:
   • Projects such as the International North–South Transport Corridor (INSTC) and the Chennai-Vladivostok Eastern Maritime Corridor can improve India’s connectivity with Russia, Central Asia and Europe. Greater connectivity can diversify India’s trade routes and strengthen economic engagement with Eurasia.
   • Cooperation in quantum computing, semiconductors, and rare earths offers India alternative technology and critical-mineral supply chains, reducing dependence on China for rare earth elements specifically.
4. Energy Security:
   • Russia is an important source of crude oil and other energy resources for India.
   • Indian investments in Russian oil and gas projects help diversify India’s energy supplies.
   • Cooperation in civil nuclear energy, particularly the Kudankulam Nuclear Power Plant, further strengthens India’s long-term energy security.
5. Strategic Balancing:
   1. Smooth India-Russia relations offers India a better bargaining chip in negotiations with the western powers. It also offers India to strategically balance and align with the powers according to its national interest. For e.g. PM Modi’s visit is taking place when leaders of the 32 nations in the North Atlantic Treaty Organisation (NATO) gather in Washington DC to celebrate 75 years of the anti-Russia military alliance.
   2. Close India-Russia relations provides New Delhi the opportunity to offset the Chinese advantage in Eurasia.

What are the Challenges in the relation?

1. Deepening of India-US relations: The India-US relations is rapidly deepening especially in the defense sector, which is exemplified in the India-US nuclear deal in 2008, US emerging as the top arms supplier to India by overtaking Russia and India-US Foundational agreements such LEMOA, COMCASA, BECA. Due to these developments, Russia changed their decades-old policy and start supplying China with weapon systems like Sukhoi 35 and the S-400 missile defence system.
2. Russia’s growing dependence on China: Moscow and Beijing have forged the closest possible ties in their history. This has generated fears that Russia will become a subordinate partner given the growing economic, demographic and technological asymmetry between them. This could jeopardize Moscow’s neutrality on Sino-Indian tensions.
3. Russia’s increased engagement with Pakistan: Russia has been increasing its economic and defence cooperation with Pakistan, like conduction of bilateral exercise Friendship. The RCP axis (Russia, China, Pakistan) will be detrimental to India’s national interest.
4. Trade Imbalances: Even though the bilateral trade between the two nations has increased in the face of crude oil imports, there is considerable trade imbalances between India and Russia. Of the total trade of $65 billion, India’s exports constitute less than $5 billion.
5. Defense Delays: There have been considerable delays in the delivery of military spares and big-ticket weapon systems like the S-400 Triumf surface-to-air missile systems, to India due to the Ukraine War.
6. Connectivity Project Implementation Gaps: INSTC and the Chennai-Vladivostok Maritime Corridor remain long-term infrastructure ambitions with significant implementation challenges which involve multiple transit countries (e.g. Iran for INSTC), sanctions exposure, and financing hurdles – limiting their near-term impact on trade diversification.
7. Ukraine Crisis: The continuing Russia-Ukraine war has put India into a diplomatic tightspot. India has been facing significant criticism for not condemning the invasion and continuing energy and economic cooperation with Moscow.

What Should be the Way Forward?

1. Neutral Player in the resolution of Ukraine Crisis: India must continue to maintain its positioning as a neutral player that could be a mediator between the two sides in the resolution of the Ukraine Crisis. India must continue to appeal to both sides to ‘abide by the international rules and conventions’.
2. Conclude the India-EAEU FTA: Prioritize finalizing the Free Trade Agreement with the Eurasian Economic Union to move beyond an energy-dominated trade basket and unlock the 300+ identified export products. The FTA will help in reducing the tariff and non-tariff barriers & expanding the access to Central Asian and Russian markets.
3. Addressing defense supply chain shocks: India and Russia must explore setting up joint venture partnerships to address the shortage of critical defense spare parts.
4. More diplomatic and financial investments: India and Russia must invest more diplomatic and financial resources to finish the pending works for the International North-South Transport Corridor. Both sides should expedite discussions on the Free Trade Agreement with the Eurasian Union for better trade and commerce.
5. Enhanced focus on Eurasia: India and Russia have to explore their opportunities in the Eurasian region. India can study the possibility of expanding Russia’s idea of ‘extensive Eurasian partnership’ involving the EAEU (Eurasian Economic Union) and China, India, Pakistan, and Iran.
6. Unequivocal message to the Western countries: India must send unequivocal message to the West that Russia occupies a pivotal place in India’s strategic calculations. It must be conveyed that the West needs India just as much as India needs the West.

Conclusion: India should modernise and diversify its long-standing partnership with Russia by strengthening economic and technological cooperation while preserving strategic autonomy. A balanced, pragmatic and future-oriented approach can help India-Russia relations remain resilient amid changing geopolitical realities.