Event ReportsPublished on Jan 18, 2020
India’s interest could be more than economic, spilling over into the domain of strategy.
India’s Look Far East: Strengthening Indo-Russian relations or something more

Growing India-Russia bilateral relations are a result of reinforcement in India’s global status, pointed out Prof. Hari Vasudevan during the lecture discussion on ‘India’s Look Far East: Strengthening Indo-Russian Relations or Something More’ held on 10 January at ORF Kolkata. The event was the sixth edition of Friday Afternoon Talk (FAT) initiated by ORF.

Russia’s initiative to start a strategic and economic dialogue with India was driven by India’s emerging profile as a state that is able to manoeuvre both capital as well as international rules. The capacity to deal with international forums like WTO is India’s strength for which even the Indian private sector is dependent on it, said Prof. Hari Vasudevan, Visiting Distinguished Fellow, Observer Research Foundation, Kolkata.

Prof. Vasudevan, began his presentation by dividing India-Russia relations after break-up of the Soviet Union into two phases. The first, from 1991 to 2000 and the second beginning from 2000. The two phases could also be referred to as the pre-Putin and Putin periods. In the first phase of the Yelstinian era, Russia was heavily influenced by the international politics and economics of the Cold War period. This was also the phase of reforms in Russia.

The second phase marked the transition from Yelstin era to Putin era. Under this phase India-Russia relations saw a boost in trade, defence and commerce sectors. Even then, bilateral trade always remained limited between USD 5-10 billion. But, since the middle of 2000, every major bilateral summit between the two countries had a surprise. In almost every bilateral summit, there has been a special concession made by the Russian Federation to India.

India’s decision to invest in Russia’s Far Eastern region and Siberia in the India-Russia summit held at Vladivostok on 4-5 September 2019 was the first of its kind in Russia’s Far East. India also offered a USD 1 billion credit during the summit that saw signing of over 40 MoUs covering trade and investments and strategic cooperation.

Russia in 2013 had launched the ‘Pivot to Asia Programme’ and had invited two and half actors from North East Asia to belong to this pivot, two viz. China and Japan and South Korea as the half actor. The pivot was well balanced and had systematically worked with an important programme that Russia had with China at the time and Shinzo Abe in 2016 had announced a special investment programme for Russia.

However, these arrangements that Russia wanted did not work  and it is pertinent to understand  why an external actor, India, came to considered as of considerable use for investments in the region.The huge landmass of Russia’s Far East is mineral rich. Despite having great resources, Russia’s Far East is at the rock-bottom in terms of its contribution to national income. President Putin had expected investments from coastal parts of China and investments for 212 projects were expected from the Chinese.

Russia opened the Siberian gas pipeline in November 2019. The Chinese were to handle the 212 projects. However, division of opinion in China about how they were to be handled led to the scaling down of the arrangements with China  by the end of 2018-19. Continuing sanctions from the Western countries had left Russia with little choice but to look towards India as a possible source of investments.

Prof. Tansen Sen, Director of the Center for Global Asia and Professor of History, NYU Shanghai, mentioned about an ecosystem that has developed around summits and the Vladivostok summit should be looked at from the lens of an evolving ecosystem of diplomacy. Presence of India, China and Russia in major economic blocks like BRICS, SCO, etc. have given a push. Professor Sen raised three pertinent questions that are embedded in the minds of a skeptic.

The first question relates to a dearth of knowledge and a lack of prior engagement as far as India’s involvement in Russia’s Far East is concerned. He pointed out that there was a knowledge and experience gap for India. The second issue is set in the regional geopolitical conundrum involving countries like China, Japan and South Korea.

Professor Sen highlighted that a few conflicting interests and disputes already exist in the region, and therefore it is confounding as to why India should be interested in the Far East. The logical impetus for such an engagement is that India could be interested to counter the ‘String of Pearls’ strategy of China by taking help of Russia.

Therefore, India’s interest could be more than economic, spilling over into the domain of strategy. However, Professor Sen also reminded that China and India have collaborated in various theatres like in Africa. Therefore, even though China is concerned about India's presence in its neighbourhood, the Chinese companies look at things more from a collaborative perspective.

Lastly, for Professor Sen, questions can also be raised if the Indian economy is doing sufficiently well for the country to go and invest in Russia. Professor Sen cautioned whether India had enough fuel to go into this uncharted territory for a prolonged period and doubted the long-term sustainability of this engagement in Russia’s Far East. China is generally persistent and operates with a long-term perspective.

He pointed out the need for a long-term economic analysis. Moreover, if countering China, was  the major agenda then there could be other viable countries for investment like for example, Vietnam.

The report is prepared by Mihir Bhonsale, Junior Fellow, ORF Kolkata. With inputs from Sayanangshu Modak, Research Assistant, ORF Kolkata.

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