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INDIA RUSSIA HIGH IN INVESTMENT
- External Affairs Minister Sushma Swaraj said that India and Russia should consider raising the overall investment target to $50 billion because the target of $30 billion set for 2025 has already been met.
MAJOR PROJECTS
- ONGC Videsh Ltd in 2001 bought a 20 per cent stake in the Sakhalin-1 project in Far East Russia.
- It further bought Imperial Energy a few years later and has recently invested in Vankorneft and TasYuryah along with Indian Oil Corp (IOC), Oil India Ltd and Bharat PetroResources Ltd (BPRL). In return, Russian firm Rosneft has bought a majority stake in Essar Oil for $12.9 billion.
SUSHMA SWARAJ VISIT
- Meeting prepared the groundwork for the annual India-Russia bilateral summit between Indian Prime Minister Narendra Modi and Russian President Vladimir Putin, to be held in New Delhi next month.
- Russia is one of only two countries with which India holds annual bilateral summits, the other being Japan.
- The Indian Minister also said that both sides have agreed to organise the first-ever India-Russia Business Summit involving major companies from both countries in early October in India.
THE PARTNERSHIP
- The India-Russia bilateral relationship was elevated to Special and Privileged Strategic Partnership in 2010.
- Modi and Putin have already met twice this year — at an informal summit in the Russian resort city of Sochi in May and then on the sidelines of the BRICS (Brazil, Russia, India, China and South Africa) Summit in South Africa in June.
NOTES
- Two weeks after India significantly upgraded its defence ties with the United States through the Comcasa (Communications Compatibility and Security Agreement), the Modi government has cleared the way for one of the biggest purchases from Russia — $2.2-billion frigates deal.
- Financial sanctions by the US have complicated purchase of weapons from Moscow as Indian banks are unable to transfer money to defence companies in Russia.
- An alternative arrangement, to pay in Indian rupee instead of the standard US dollar, is being worked out to partly deal with the matter.
DETAILS OF THE DEAL
- The agreement will allow India to procure four new warships from Russia for the Navy.
- The deal will also involve building two of the ships at the Goa shipyard.
- The deal has been processed as 2+2 scheme.
- In this scheme, the technology will be transferred to Goa Shipyard to construct two of the frigates from scratch
- The Indian-made warships are expected to cost 30-50% more than the direct Russian import due to the cost of building infrastructure and transfer of technology.
THE DETAILS
After Crimea fallout, Russia and Ukraine suspended all defense ties which rendered the underconstruction Admiral Grigorovich class frigates of limited operational use to Russian Navy until they were re-engined with Russian alternative which is expected to be ready only by 2020.
NOTES
- India’s defense acquisition council has sanctioned$75 million for acquiring M7N.1E gas turbine engines from Ukraine for powering the two Grigorovich class frigates that are expected to soon arrive in India from Russia.
- India had agreed to purchase the two frigates Admiral Butakov and Admiral Istomin
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