India calls for broad based extensive business cooperation with Russia

Advocating the need to extend the economic co-operation between India and Russia beyond the purchase of defense equipment and investment in oil and gas, Indian Commerce and Industry Minister Anand Sharma called for broad based extensive business cooperation between the nations with a common target to achieve $20 billion in trade by 2015. During a round table at the economic forum in St. Petersburg, Russia, both sides expressed their political intent to start negotiations towards a Comprehensive Economic Cooperation Agreement (CECA).

Both Anand Sharma and the Minister of Economic Development of the Russian Federation Elvira Nebullina indicated that dialogues will enable the two countries to realize the potential of cooperation that exist between the two countries. With a view to step up trade relations the countries agreed to form six working groups under India Russia Working Group on Trade and Economic Cooperation (IRWGTEC) with Government and private participation on IT, Pharma, Banking and Finance modernization, precision engineering and nano technology.

Sharma, who co chaired Inter-governmental Commission and has led bilateral economic cooperation with the Deputy Prime Minister of Russia Sergei Ivanov, also took up the issue of increased market access for Indian manufacturers in Russia, mainly in the pharma and agricultural products sector. According to the statement released by the commerce ministry, the minister outlined specific steps that need to be taken in this direction such as, participating in the Pharma 2020 Programme of Russia by setting up production units in Russia which would require suitable facilitation by Russia; streamlining registration process; sharing of information on drugs that are imported by Russia and on assessed production volumes of strategically identified medicines; setting up the Task Force agreed under MOU for Pharma and Bio-pharma sectors; market access for drugs that are exported to USA, EU and Japan, etc.

Russian and Indian economies are worth $1 trillion combined and the total trade between the two countries currently stands at $8.5 billion with Indian investments in Russia estimated at around $5 billion while that of Russia in India at around $3.5 billion. Machinery and equipment accounts for more than half of Russian exports to India, and oil and gas just 5 percent. The minister stated “there is considerable scope for enhancement of trade as well as investments in the pharmaceutical sector. The Indian pharmaceutical products are of international standards and cheaper than other markets on an average by 30-40%.”

Even as Russian Deputy Prime Minister Sergei Ivanov underscored that pharmaceuticals and aircraft manufacturing are promising areas of cooperation, he expressed regrets that Russia and India cooperate insufficiently in civilian aviation and suggested India to take a closer look at certain Russian jetliners. Citing the decline in bilateral economic contacts and trade, Ivanov also called on businessmen of both countries to bolster economic relations.