Union Minister of Commerce & Industry and Civil Aviation, Suresh Prabhu, met a high level Russian business delegation on Saturday in New Delhi. Discussions were held on increasing investments and business engagements with Russia.

Russia has invested USD 1.2 billion in India between 2000 and 2017. In the 18th annual summit that took place in St. Petersburg between Prime Minister of India and President of Russia in 2017it was decided to increase it by 10 times in 6 to 7 years. The key areas of Russian investments have been oil and gas,defence equipment supplies, power and energy and large scale infrastructure project.

There is immense potential for the two countries to further expand economic ties and move beyond buyer – seller relationship. The Minister said that in order to facilitate this India has set up a one stopshop for Russian companies in Invest India called Russia Plus, which will fast track investments. Minister further stated that there is possibility for Russian investments in Delhi-Mumbai industrial corridor,smart cities, railways, public transport, sanitation and low cost housing. Commerce Minister said that Russia canbe a valuable market in information technology and services sector considering IT and services are India’s largest exports. Indian companies may also explore links with Russian companies in software for the manufacturing sector.

India’s pharma exports to Russia constitute a sizable chunk but possibilities of joint investments are being considered by leading Indian pharma companies under Russia’s Pharma 2020 programme. Commerce Minister further said that although Russia is a primary source of defence equipment supply to India, ample opportunities have further opened up for both countries with the opening of FDI in defence production in India. Russian companies may consider investing in a dedicated industrial park for defence manufacturing under the new norms to supply parts to helicopters, nuclear reactors and solar panels. The Minister further stated that India intends to create avibrant startup eco-system and Russia can actively partner by providing technology, assistance in setting up incubation centers and actively investing in startups. During the meeting the possibility of potential cooperation in areas of oil and gas sector, aerospace, ports and shipping and railways and also in the sectors of fertilizers, gems and jewelry and tourism were discussed.

Commerce Minister also explained the procedure and policy for establishing green field and brown field airports in tier-II and III cities in India. Russian investments may also be explored in the pilot training center coming up in the country. Suresh Prabhu invited Russian aerospace companies to participate in the global aviation summit to be held in India in January 2019.

In 2017 total trade between India and Russia wasUSD10.13 billion. Imports to Russia stood atUSD8.04 billion and exports from India wasUSD 2.08 billion. Commerce Minister emphasized that all efforts should be made to narrow down the trade deficit. One of the major reasons for having low trade is due to trade barriers like banking, sanitary and phytosanitary issues, language barrier and visa issues.

The Minister informed that the International North South Corridor (INSTC) is an important initiative taken by India, Russia and Iran to promote transportation cooperation and to enhance connectivity with central Asian countries. The INSTC is the shortest multimodal transportation route linking the Indian Ocean and Persian Gulf via Iran to Russia and North Europe. The estimated capacity of the corridor is 20 to 30 million tonnes of goods per year and will reduce time and cost by 30% to 40%. The Minister emphasized that in the 23rd November 2018 trilateral meeting on INSTC all issues may be resolved in order to operationalize the route as early as possible.

Investment facilitation via a one stop portal to fast track bilateral projects and sectoral cooperation between India and Russia. Discussions focused on accelerating bilateral economic engagement through targeted investment facilitation via a one stop mechanism, Russia Plus, to fast track investments in priority areas including oil and gas, defence production under liberalised FDI, power, large infrastructure, IT and services, and joint pharmaceutical ventures, alongside cooperation on start up incubation and technology transfer.