India-Russia trade is undergoing a major structural reset, transitioning from a relationship dominated by energy and defense into a diversified economic partnership. President Vladimir Putin and Prime Minister Narendra Modi formalized a blueprint for long-term economic integration with targets to reach US$100 billion by 2030. Explore the Russia-India business corridor. Find analysis on bilateral trade, strategic joint ventures, and investment opportunities. Key intelligence for companies in this growing partnership.
India has added several Russian companies to, and extended the licences of several Russian maritime insurance companies after coverage expired due to delays caused by problems in the Persian Gulf. The number of Russian insurers licenced to finance maritime risk in India has been increased to eleven.
Russia and Pakistan have commenced discussions concerning a Pakistan-Eurasian Economic Union Free Trade Agreement. Pakistan has an economy worth over US$2 trillion and a consumer market of over 250 million people. Moscow see Pakistan as a promising partner in the region with significant potential for growth.
Russia has stepped up diplomatic and energy supply chain developments this past month with visits to India, Bangladesh and Sri Lanka, while Pakistan and Afghanistan, both bordering Iran, are also developing as key links in new emerging South Asian oil and gas infrastructure and architecture. We examine what is happening in a region that Russia is almost right in the centre of as regards energy security and future supplies.
The Russian Deputy Foreign Minister Andrey Rudenko has stated that Russia will not export oil to any countries imposing a price cap. This affects all the G7 nations including the European Union, who have imposed price caps at US$45 a barrel for Russian fuel oil. However, volatility created by the conflict in Iran has seen prices fluctuate between US$75 to above US$100 a barrel while Russia has shifted its energy export priorities to markets in Asia. JP Morgan analysts suggest the price could reach US$150 a barrel if the Strait of Hormuz is not reopened soon.
Russian rail connectivity and freight volumes with the Shanghai Cooperation Organisation countries has been increasing and is set to continue this trend. We examine the rail development plans of each of the major national carriers as it becomes apparent that overland supply chains must improve in the wake of regional maritime uncertainties and conflicts.
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India has placed a US$25 billion defence sector order with Russia for various military equipment including S‑400 air defence missile systems, various types of aircraft, and artillery systems, as part of a rapid military modernization drive. India is the world’s fifth‑largest military spender.
Russia is discussing energy supplies with Sri Lanka, as the country looks to diversify away from an over-reliance on Middle Eastern import supply chains, to alternative suppliers and developing its renewables sector. Sri Lanka has introduced restrictions on energy use in recent weeks due to problems with imports due from Iran.
Russia’s RZD Logistics are reporting an easing of rail transport problems along the INSTC and are saying that trains servicing the routes via Iran are now being booked for the March and April.
India is discussing increasing the supplies of fertilizer from Russia as imports from the Middle East have ceased and China has also prohibited exports. The Indian summer crop planting season has begun and lasts through until the start of the June monsoon season, meaning the situation is becoming time critical.
The Iran conflict has cut off Europe from its normal Southeast Asian aviation routes, yet Russia has been able to call on regional members of the Commonwealth of Independent States, BRICS, and the Shanghai Cooperation Organisation, as well as its new Asian diplomatic strategy, to reroute flights to the east and use Eurasian connectivity to access Southeast Asian tourist destinations. This move could ultimately open up new transport hubs in Central Asia to service these markets in problems persist in the Middle East.
India has begun immediate imports of Russian crude as it gains secondary tariff exemptions from Washington. India’s growth is a major global economic driver and without it, Western economies will feel even more fiscal pressure. India and the United States signed a trade agreement last month as Washington looks to increase its India supply chains as it diminishes its Chinese ties and cannot afford to have both economies stalling at the same time.
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