The solidity of Indo-Soviet relations is so well established now that it seems hardly necessary to recapitulate the background. It is difficult to mention the factors that brought about the convergence of policies and interests of India and the Soviet Union. Indo-Soviet relations had deep roots. Trade exchanges between the Union of Soviet Socialist Republics (USSR) and India was promoted after the conclusion of a Soviet - British trade agreement in 1921. In the mid- 1920s, the first batch of spices, rice, tea, raw jute and other goods were supplied from India to the Soviet Union. In 1925, Soviet oil products for the first time reached the Indian market, and at the end of the next five years, the first big consignment of Soviet sugar was sent to India. Crude oil and oil products- Kerosene and petrol were the main Soviet exports to India. Cheap and high quality Soviet Kerosene successfully competed with the oil products of British companies, causing soon a 30 % reduction in the price of these goods in the Indian market.

In 1935, Soviet Union became the best buyer of Indian goods and itself could also supply India with a number of manufactured articles. But this was the prospect that most worried the ruling circles of Britain, by whose unilateral efforts, Soviet- Indian trade in 1939-40 was in fact reduced to zero. The main obstacle in the way of rapid development of Soviet Indian relations was the dependence of India on British imperialism. After the proclamation of India as a republic, the relations between the two countries became closer. This found reflection in agreements on exchange of goods, which ensured supply of grain from the U.S.S.R. in exchange of jute, tea, castor oil, tobacco, shellac and some other products. The first Soviet trade agency in India was established in Calcutta in 1943. India gained diplomatic relations with the U.S.S.R. and received a good impetus for all round expansion after Independence in India-Russia relationship helped in different ways, on one hand, in the struggle against Western imperialism and colonialism and on the other hand, in the national interests and requirements of India in the last 20-30 years of the Soviet Union. In 1950, India had persistent balance of payment difficulties due to accelerated economic development. Bilateral trade and payment agreements with Russia helped India to a large extent.

Gorbachev wanted to end the supremacy of the communist party of the Soviet Union and democratize the administrative command system. The fall of the communist Governments in Eastern Europe also affected Soviet Union. Gorbachev failed for getting large scale economic aid and resulted in disintegration of Soviet Union. Yeltsin took charge of Russia in the year 1990 and Russia got revived in the year 1991 but there was resurgence of Russia only during Putin’s time period. Russian economy saw the doubling of nominal GDP; industry grew by 70%, investments increased by 125% and agriculture production increased as well in his period. Medvedev joined as president in 2008 and had priority for Russia’s economic development strategy up to 2020 and aimed at modernizing the economy

2 Historical background

the USSR under Stalin (Iosif Dzhugashvili), was suspicious of the genuineness of India’s independence and non-alignment. However, Indo-Soviet bonhomie started with Jawaharlal Nehru’s visit to the USSR in June 1955 and the Nikita Khrushchev/Nikolai Bulganin visit to India in December 1955. This was also the time when the Congress party in India was affirming its belief in state planning and a ‘socialistic pattern of society’, and Nehru was playing a leading role in the Bandung Conference (1955) of 29 Afro-Asian nations.3 During the same period, the USSR began to use the instruments of aid, trade and diplomacy in developing countries, to limit Western influence.2 Subsequently, Indo-Soviet relations flourished over the decades in the metallurgy, defence energy and trade sectors. During the India–China war in 1962, the USSR tried to be neutral between what it called ‘brother China’ and ‘friend India’, with the People’s Republic of China seeing this as a betrayal of international communist solidarity on the part of the USSR, and a factor that reflected and further exacerbated the growing Sino–Soviet split. In the early 1970s both Indian and Soviet leaders looked on the emerging US-Chinese rapprochement as a serious threat to their security. Their response had been in 1971 with the Indo-Soviet Treaty of Peace, Friendship and Cooperation, which provided immediate consultation in case of military action against parties to the Treaty . During the India–Pakistan war in 1971, the USSR took a firm position in favour of India and sent ships to the Indian Ocean to counter any move by the USA, which had already sent its 7th Fleet ships into the Bay of Bengal. The results of the 1971 Indo–Pakistani war and emergence of Bangladesh established a trusted partnership between India and the USSR. During the 1980s both Rajiv Gandhi and Mikhail Gorbachev advocated a nuclear-free world. However, after the Soviet invasion of Afghanistan in 1979, India was also confronted with a dilemma of how to preserve its non- aligned credibility without jeopardizing its relations with the USSR. In the initial post-Soviet period, bilateral relations in the 1990s went through a period of uncertainty when Russia was preoccupied with domestic economic and political issues, and with its relations with the USA and Europe.4 Now India had to deal with a new Russia which was Eurocentric, economically dependent on the West, and neither had the interest nor the resources for Third World regimes.7 President Boris Yeltsin, during his visit to Delhi in 1993, tried to recreate the spirit of old friendship with a new Treaty of Friendship to replace the old India-Soviet 1971 treaty. However, the fundamental character of the Treaty was transformed and in case of any threat to peace, the new Treaty vaguely called for regular consultations and co-ordination.5 Although Yeltsin described India and Russia as ‘natural partners’, he was careful not to give the impression of a ‘special relationship’.6 Although relations were restored to respectable levels, the early years (1991–96) of ‘benign neglect’ of India by Russia left a deep mark on Indian policy-makers.10 The situation changed when the new Russian Prime Minister Yevgeny Primakov (1998–99) started shifting from the previous pro-Western Russian foreign policy. To strengthen his country’s relations with old allies, Primakov visited India in 1998 and pushed proposals for creating a Russia-India-China (RIC) strategic triangle, although RIC coherence remains questionable for some Indian commentators like Abanti Bhattacharya: ‘the development of a strategic triangle would be unrealistic. The reasons can be easily found in the mutual suspicion between India and China’. The new Russian leadership under Vladimir Putin (president, 2000–08) reversed the Yeltsin-era drift in India-Russia bilateral relations, signed the Declaration on Strategic Partnership with India in 2000 and established the institution of annual summit meetings.7 Moscow realized that as a Eurasian power, an active Russian role and influence in dynamic Asia would be limited without a solid partnership with old friends like India. Indian commentators welcomed Putin’s comment in his 2004 visit, that ‘India is our strategic privileged partner *...+ And speaking from the point of view of geographical representation *...+ India is number one’, as recognition of India’s own rise: The emphasis is to be interpreted both in the geopolitical context and also in the military context. In terms of geo- political interpretation one could say that Russia accords primacy to India in the Indian sub- continent and all that it implies. In the military context it stresses that Russia recognizes India not only as a strategic partner but also as a ‘privileged strategic partner’. If this is Russia’s emphasis truly, then the long range prospect of Russia-India strategic cooperation is pregnant with exciting prospects.8

Despite its improving relations with the USA, China and Europe, India also did not want to abandon its time-tested relationship with Russia. In a world dominated by a single power (the USA), both the Indian and Russian vision of a multi-polar world coincided. The issue of terrorism has also brought the countries together. Within South Asia, Russia has consistently supported India on the issue of Kashmir unconditionally over time or regime change and opposed its internationalization.14 These issues continue to be reiterated at their Summit Declarations. Another point which both the partners have been emphasizing after every important meeting is that their partnership is neither against any third country nor at the expense of their relations with other major powers, understandable given Russia’s strategic links with China and India’s with the USA

3 Fight against Terrorism:

Terrorism is an issue that concerns both India and Russia. Though India has been a target of this menace for a relatively elongated period but it surfaced in the bilateral relations only after the downfall of the USSR. India is facing separatist activities in J&K, and similarly Russia in Chechnya, both in the name of the “right for self determination”. Both nations are finding it difficult to restrain these movements. Both India and Russia consider these movements as terrorism, instead of the “right for self determination”. It is believed by both countries that some neighbour countries are assisting the separatists by providing “moral, political and financial support” to them. Thus there is a convergence of views on the subject.

According to the Document on Strategic Partnership in October 2000 summit; India & Russia have promised to work in close tandem, for fighting the menace of “global terrorism and religious extremism”. Both decided to set up a “joint working group” to plan out a collective approach to fight international terrorism. Both sides emphasized “the importance of joint efforts for establishing a solid international legal basis for cooperation in combating international terrorism”. 10

Putin reiterated that “India and Russia were natural partners and allies” in their collective aspiration and objective of fighting terrorism. “Exchanges of information, political support and joint decision making on any manifestation of extremism could effectively weaken international terrorist groups”. 11 Both India and Russia are actively engaged in their military offensive against terrorist groups operating in Kashmir Valley and Chechnya respectively.

The factor of terrorism received international attention after the attack in New York and Washington in September 2001, thus changing the politics in the region affecting the whole gamut of international power equations. The creation of the so called global coalition against terrorism was received well by both India and Russia. Russian Deputy prime-minister Ilya Klebanov’s visit to New Delhi in October 2001 was of crucial significance in this regard. He underlined the need for joint action by New Delhi and Moscow against global terrorism.

Sh. Vajpayee, the then Indian Prime-minister, paid a return visit to the Russian Federation in November 2001 contributed in carrying forward the “political dialogue on global, regional and bilateral issues of mutual interest”. While reaffirming their commitment to fight terrorism, Prime Minister Vajpayee and President Putin signed the “Moscow declaration on international terrorism”. It explicitly underscored that all terrorist acts are unjustifiable and unacceptable. On this occasion, both leadersprofessed an ‘absolutely identical’ position which held that global terrorism should be fought in accordance with international law and the provisions of the UN Charter. 12 The declaration also underlined the need for close interaction between the two countries at bilateral and multilateral levels to deal with the menace of nuclear, chemical and biological weapons, including illegal trafficking in arms and narcotics.

Russian Foreign Minister Igor Ivanov visited India in February 2002 was a big step towards the bilateral relations between India & Russia. The focus of this meeting with Indian leaders was on developing a common strategy to combat terrorism. Ivanov and his Indian counterpart Jaswant Singh agreed that Pakistani President Pervez Musharraf should translate his January 2001 speech, regarding his commitment to fight terrorism, into concrete on the ground results. The two sides agreed that unless cross-border terrorism was fully stopped by Pakistan there was no rationale for resuming a dialogue with Islamabad. Putin went one step further during his visit to India in December 2002, when he warned the world community that “Pakistan’s weapons of mass destruction could fall into the hands of ‘bandits and terrorists’”. India and Russia signed a “Memorandum of Understanding on Cooperation in Combating Terrorism” during Putin’s visit in 2002. Based on this MoU, a “Joint Working Group on Combating International Terrorism” was formed. The first meeting of this JWG was held in Moscow in September 2003.

During meeting of this “Joint Working Group on combating International Terrorism”, the parties stressed the commitment for eradication of new threats and challenges which are an important aspect of “Indian-Russian special and privileged strategic partnership”. They discussed the threats of “cross-border terrorism” and expressed their commitment for the fight against the global threats. In UN Security Council, India and Russia stressed the role of international effort for combating terrorism; and argued for the implementation of “UN Global Counter-terrorism Strategy” and other related resolutions for eradication of terrorism. They expressed their concern towards drug trafficking which is responsible for hampering peace andstability of the world; and wanted to start their negotiations in the form of “Intergovernmental Agreement on Cooperation in Combating Illicit Traffic in narcotic drugs, psychotropic substances and their precursors” which was signed on 8 November 2007. India & Russia “have set up a panel of experts to fight terror and to share information between their security agencies, exchange equipment and help each other in training”. 14 This has always proved valuable for both India and Russia to share each other’s experience in this important area of fighting terrorism.

During President Putin’s visit to India in 2007, he said that bilateral cooperation is a vital part in “strategic partnership” between India and Russia. Both nations gave their support to suppress funding of global terrorism and combating illegal drugtrafficking. Both India and Russia are of the opinion that since terrorism and organized crime happen to be global in nature, these issues need to be dealt at a suitable forum like UN. Terrorism is a global destructive phenomenon affecting all states and societies; and morally dangerous to all people of the world. India and Russia strongly feel that “there can be no double standard in the fight against terrorism otherwise this struggle will become meaningless”. 15

Russian President Medvedev visited India in December 2008. In November 2008, there were horrifying terror attacks in Bombay in which 166 people died. This was the first visit by any world leader, and hence it was significant and exemplary. For obvious reasons, the top and most important point on agenda was terrorism, as both countries faced the same problem of terrorism. Russian president voiced their solidarity with the people in India. He vowed to “work with India on the whole spectrum of problems and provide support in all directions”. After the summit a “Joint Declaration” was signed, through which the global community was urged to help so that the culprits of the 26/11 Mumbai attacks are brought to justice. The “JointDeclaration” also called upon all countries to “actively cooperate with India in its efforts to find the perpetrators,

In April 2011, the 7th meeting of the “India Russia Joint Working Group on Combating International Terrorism” was held. Both India & Russia stressed that they will cooperate in thwarting the threats of terrorism, and this is an vital aspect of the “Indo-Russian special and privileged strategic partnership”. The two countries voiced shared unease regarding constant dangers of “cross-border terrorism”. India & Russia reiterated the commitment to “consolidate bilateral interactions”, to fight against the international menace. It was decided to establish a dialogue within the “Financial Action Task Force (FATF)” and the “Eurasian Group (EAG)” on “Combating Money Laundering”. Both sides expressed their anxiety about “the issue of drug trafficking which undermines peace and stability in the region”.

Prime-minister Dr. Manmohan Singh visited Russia in October 2013. During his visit, India & Russia “condemned terrorism in all its forms and manifestations”. The leaders were In agreement that “sheltering, arming, training or financing of terrorists” should not be tolerated at all. Both countries reaffirmed “the UN central role in combating international terrorism and expressed their intention to make an active contribution to counter terrorism”.17

4 Investment

In the energy sector India’s state public sector Oil and Natural Gas Corporation (ONGC) is active in Russia. In 2001 ONGC Videsh Limited (OVL) acquired a combined 20% interest in the Sakhalin-1 project. From 2006 this project started to generate positive cash flow. During 2008/09 ONGC’s share of production was 1.853m. metric tons of oil and 0.372 billion cubic metres of gas. In 2009, at a total cost of $2,100m., OVL also completed the acquisition of seven blocks in the Tomsk region of western Siberia, previously held by a United Kingdom- listedcompany, Imperial Energy. At present, this Tomsk acquisition produces oil mainly from two fields and has its own infrastructure including pipeline network, field processing facilities and connections to the Transneft pipeline system. The Indian ICICI Bank has opened its subsidiary ICICI Bank Eurasia in Russia, with branches in Moscow and St Petersburg. TATA Motors launched a project to assemble its light-duty trucks at Russia’s Urals Automobile and Motors plant and assembling plant for buses at Volzhanin and Samotlor. The SUN group has also invested in Russia’s food and real estate industries. Similarly, pharmaceutical companies like Dr Reddy’s Laboratories Ltd and Lupin Ltd have investments in Russia. Berger Paints has also started operations in Russia. Carborundum Universal has purchased an 84% share in Russia’s Volzhsky Abrasive Plant in the Volgograd region. The GMR Infrastructure has participated in a tender for the reconstruction and maintenance of St Petersburg’s Pulkovo Airport. Other companies that are exploring possibilities for investment in Russia include GAIL, Indian Oil, Coal India, Reliance and Tata Tea. Similarly, a few Russian companies are active in the Indian market. Silovyie Mashiny and Tekhnopromeksport are providing equipment and technical assistance for the construction of the Sipat thermal power plant in Chhattisgarh, Bihar and Uttar Pradesh. Two 1,000-megawatt nuclear power plants in Kudankulam, Tamil Nadu, are being constructed with the help of Russian Atomstroiekspor. In March 2010 both agreed on the construction of two more reactors (units five and six) at Kudankulam and two reactors at Haripur in West Bengal during India’s 12th Five-Year Plan period, 2012–17. Their agreement also outlined the timeline for the steps to be taken for the construction of Kudankulam units three and four, and called for progressive indigenization of supplies for units five and six at Kudankulam. For all six reactors at Kudankulam, Russia will provide the equipment and components, while Nuclear Power Corporation of India will build them. The Russian AFK Sistema owns a 73% share in the Indian telecom operator Shyam Telelink. It is constructing a pan-Indian transmitting network, Shyam. The Russian VTB bank has also started operations in India. Sberbank also intends to enter the Indian market. The numerous other infrastructure companies that are already operating in India include Transstroi and Tsentrdorstroi (road construction), Elektrostal and Tyazhpromeksport (metallurgical industry) and Stroitransgaz (gas pipeline). A joint venture between Russian truck-maker KamAZ and India’s Tatra Vectra Motors is nearing completion. The unit will produce Kamaz-6540 dump trucks of over 25 metric tons and Kamaz-5460 prime movers. Zarubezhneftegaz is doing exploration work along with GAIL in the Bay of Bengal. Russia’s GidroOGK and India’s SUN Group launched a joint venture called RusSUNHydro in 2009, with the newly formed company planning to participate in hydro-electric projects in India. At the India-Russia Summit in 2007 a decision was made to establish a joint India-Russia titanium product facility. In February 2008 Russia’s State Property Committee, the St Petersburg-based engineering company Tekhnokhim Holding and India’s Saraf Group agreed to set up a plant in Orissa. The Russian share in the project is 55%, which is expected to be financed through Indian outstanding debts to Russia. Overall, however, Russian investment in India remains minuscule. According to the Indian Ministry of Commerce and Industry, total foreign direct investment (FDI) from Russia during the period between April 2000 and March 2010 was about $373m., which was 0.34% of total FDI inflows to India during that period.

5 Medvedev Vision of Russia’s Future

on May 7 2008, Medvedev joined as the third President of Russian Federation and aimed at modernizing the economy. His vision of Russia’s future is mainly focused on energy efficiency and corruption reduction. On May 8, 2008, he appointed Vladimir Putin as Prime Minister. Medvedev has prioritized Russia’s economic development strategy up to 2020. The objective is to determine the ways and methods for steady rise in living standards of citizens, strengthening national security and dynamics of economic development in the long run to make Russia one of the technological leaders of the world to raise labor productivity in major sectors of the economy, to increase the share of middle class in country’s population by up to 60-70%, decrease the death rate by one and half times and enhance average life expectancy to 75 years. The strategy emphasized to concentrate efforts for solution of three key tasksi Creation of equal opportunities for the people. ii) Encourage motivation for innovation based development. iii) Significantly raise effectiveness of the economy mainly based on growth of labour productivity.

There are only four possible development strategies for Russia: rent centered strategy, mobilization strategy, strategy based on inertia and modernization strategy: i. The essence of rent based strategy advocates that source for development would be rent collected from natural resources. During decline in energy prices, the risk of conflict based on redistribution is fairly high under this strategy. ii. Mobilization strategy is based on concentration of resources in state-sector and its redistribution for development of priority sectors like energy, infrastructure. iii. The inertia based strategy stipulates tactical maneuvering between various interest groups and find a solution to problems as they get acute. iv. Modernization strategy is a complex institutional arrangement of the society, business and state. Strong point of the strategy is positive long term outcome in the sphere of socio-economic development.

Experts estimate the probability of execution of above strategies as Rent strategy- 20%, mobilization strategy-20%, inertia-50% and modernization strategy only 10%.The first three forces together could take the country on to a modernization path only through their joint efforts. The new long term development plan has given priority to investment in human capital, improving the quality of education, science, health care, building of national innovation system, modernization of the economy by way of rational use of natural resources and development of new competitive sectors in high tech areas of knowledge economy.

The ultimate objective of the strategy is to make Russia one of the top five economies of the world and establish Russia as a leader in global energy infrastructure, technological innovation as well as a major international financial centre. The broad objectives of the strategy are to increase the GDP to a level that would ensure $21000 per capita income by 2020 and 3.4% share in global GDP to place 60-70% of thepopulation in the category of middle class and reduce poverty level to that of developed countries. Innovation – driven development strategy would ensure transfer of Russian economy to the trajectory of long-term sustainable growth with an average annual growth rate of 6.4-6.5%.

Medvedev has focused on innovation as the central pillar of the long term development strategy.

Innovations in five major directions are:

i. Energy effectiveness, energy saving and work on new type of energy.

ii. Nuclear technology

iii. Space technology

iv. Technology in the medical sciences and

v. Strategic information technology

6 Cooperation on Afghanistan:

Afghanistan has been unstable for the last many years. Instability in Afghanistan has also adversely influenced peace and security not only in Russia & India but Central Asia also. It is feared that instability in Afghanistan can adversely affect the stability in Central Asia. Central Asian region is known as “Russia’s strategic underbelly”. Hence Russia is worried about the situation in Afghanistan. Similarly, India also earnestly considers that the groups involved in “armed insurgency” in J&K have strong links with Afghanistan. In addition to the threat of terrorism from various groups having links in Afghanistan, both India and Russia attach “political and economic importance” to Afghanistan. As the matter was of common interest, India & Russia decided to set up a “Joint Working Group (JWG) on Afghanistan”. This indicated the importance of cooperation on this issue between India & Russia. In view of the “worsening of situation in that country, increasing Talibanization of Pakistan and new Af-pak policy of the US”, India and Russia are maintaining regular and active collaboration on this subject through the “JWG on Afghanistan”.

History shows that India shared warm cultural links with Afghanistan. India viewed Afghanistan and Central Asia as an extension of its regional geo-political competition with Pakistan where Afghanistan had to play a vital role because of its location. It has been an important aspect of Pakistan’s foreign policy to have “strategic depth” in that area. If India also has the same objective, there will be Pakistani resentment against it. Afghanistan presents a “gateway to energy rich Central Asian States”, and hence important to us. According to a report by a US based Pakistani Policy Working Group, “Pakistan’s concerns that India is trying to encircle it by gaining influence in Afghanistan, has in part led to continued Pakistani ambivalence towards theTaliban”.40 Under the circumstances, India would like to confirm that the states in that region or either in favour of India or they are neutral. 17

The 9/11 terrorist attack in the US were a sign of the rise of Islamic fundamentalism and terrorism. After these attacks and dissolution of the USSR, Russia wanted to check the rise and consolidation of “Islamic or national movements in the Central Asian Republics” or even in any part of Russia itself, such as Chechnya. The effect of the 9/11 terrorist attacks on the US and the war lead by the US in Afghanistan, India & Russia had to change the strategy being followed by both of them. Both silently accepted the role of the US in fighting terrorism. The reason for this sort of cooperation was that upon breakdown of the USSR, Russia had proven unable to maintain stability in Central Asia and secondly, despite military and economic support by India and Russia, it was not possible for the Northern Alliance to topple the Taliban regime.18 In 2001, after the end Taliban, India tried to renew ties with Afghanistan. India has a huge stake in Afghanistan and has committed around $2 billion in developmental assistance to that country, thus becoming one of the leading international donors in Afghanistan. Besides a consortium of Indian companies, both from public and private sector won the right to invest in the Hajigak iron ore reserves in Afghanistan. 41 After globalization, it is more important to have “economic cooperation”, than to go for “military intervention”. Russia is also exploring options for investment in Afghanistan.

In the present scenario, when US led war in Afghanistan has ended, there is a potential danger of destabilization in the region and Afghanistan can be a center of “Islamic radicalistic movements”. Both India and Russia are concerned about the situation arising in Afghanistan after the withdrawal of US forces from there. Russia is worried because the terrorists may shift to Central Asian Region. This will affect Russia’s authority in the region. India is also apprehensive that destabilized Afghanistan may harbor transcontinental terrorists, and may disturb the internalconditions here. Increase on Pakistani impact in Afghanistan will also be a source of worry for India. Thus cooperation between India and Russia is essential on Afghanistan issue, particularly after pull out of American and other armed forces from this country. As per one of the current agreements India will help and fund Afghanistan for procuring Russian weapons. India has also shown willingness to help fledgling Afghan National Army (ANA). In October 2011, India and Afghanistan signed a “strategic partnership agreement”. As per the same, India will assist Afghanistan in “training, equipping and capacity building programme for Afghan National Security Forces”. India looks upon Afghanistan in the context of its rivalry with Pakistan as well as it also recognizes substantial economic potential. India wants to avoid the return of a Pakistan aligned government in Kabul which uses Afghan soil to prepare terrorist attacks on India.19

After the withdrawal of US-led NATO forces from Afghanistan, India & Russia are troubled about the situation in Afghanistan arising in 2014. India and Russia could play active roles to maintain peace and stability in the fragile nation and its neighbourhood. Both countries have already deliberated on this issue in forums including in SCO, BRICS and RIC. Recently they deliberated on joint projects for peace in Afghanistan. India Russia partnership can also provide necessary bulwark to counter menaces of drug trafficking and terrorism in that region. In case the Taliban were to take over the reins of power in Afghanistan once again; Russia, India and Iran would need to revive their cooperation to back up a grouping in Afghanistan which could serve as an antidote. The stability of Afghanistan is also critical to the safety and security of the planned TAPI pipeline which will bring natural gas from Turkmenistan to India; and is scheduled to be operational by 2019. Stability in Afghanistan will be helpful in implementing other “ideas” like the “North Southcorridor”, which will provide a link between Russia and India. This will be the shortest transport corridor between India and Russia. This short route will boost the trade between India and Russia, and can be adapted as a peace route and should “serve as a barrier to the movement of extremists and drugs”. 20 India would need to go for innovative diplomacy when it engages with post-2014 Afghanistan in the interest of its own national security

7 Democracy:

After the fragmentation of the USSR, the leadership of Russia adopted the path of democracy for the development of Russian Society and polity. The initial years (1991-1993) of Russian democracy were fragile. The elementary apparatus of democracy did not hold the ground. Even some writers predicted the failure of democracy in Russia because Russian culture was mainly anti-democratic and antiliberal. Initially, contending political forces fought their battles by means of character assassination, threats, wild demagoguery; and finally tanks and bullets. By the year 1995, political conflict was likely to be waged. Slowly and gradually, it started to evolve itself into a mature democracy.

Boris Yaltsin adopted the principles of democracy in his own characteristic fashion. During his speech at the UNSC on 31st January 1992, he said “our principles are simple and understandable: the supremacy of democracy, human rights and liberties, legality and morality” The Russian constitution incorporated the “principle of popular franchise” and “Law of basic Guarantees of Electoral Rights of the Citizens of the Russian Federation”. However, the incorporation of these democratic principles became slow in the initial years. With time the situation started gaining momentum. Because of the spirit of pluralism and democracy, Russia has never faced dearth of political parties to represent diverse interests of the diverse people. The transition of Russian Society from command system to democratic system started proceeding in a smooth manner. A survey conducted showed that 75% Russian agreed that they could choose any organization they wished; and 79% believed that there had been a great increase in freedom of conscience. 21

Both India and Russia have the same goal of establishing democratic order. Both are determined to reinforce the “fundamentals of democracy; to impart maximum transparency to their respective social, economic and political system”. 54 There is much that Russia can learn from the rich democratic experience in India. In order to strengthen the democratic process in Russia they signed an agreement in 1998 on establishing an Indo-Russian Inter-Parliamentary Commission co-chaired by the “Speaker of Lok Sabha (India)” and the “Chairman of the State Duma (Russia)”. Its first session was held in New Delhi in March 2000. In this session both the countries discussed about the democratic conditions in each country and focused on exchange of democratic ideas between the two countries.

Vladimir Putin firmly believed that given the conditions in Russia, it could become a great power “by combining the principles of market economy and democracy”. When Putin visited India for the first time, he complimented the “democratic system” in India saying that this “positive experience is very valuable for Russia because Russia like India is a huge pluralistic state”. He admitted that the Russia recently adopted the democratic system of governance, and being a new system, it suffered from certain weaknesses. He opined that Russia can establish democratic ethos, by learning from “Indian democratic experience”. As Russia and India both had democracy, both are multi-ethnic, both are pluralistic societies, and both were being attacked by terroriststhe governments in both countries thought that they can come closer to take “common positions against non-democratic countries” like Pakistan, in which the military regime was providing protection to such terrorists.

Hence, this affirms that both, India and Russia have common stakes in the preservation and smooth functioning of democracy, not only in their own countries but around the world also. Inter-parliamentary contacts also act as cement in IndoRussian partnership; as such contacts provide opportunities for politicians of different parties to interact with each other. As different political parties of India and Russia are involved, it provides “continuity, trust and mutual understanding” in relationship.

Since collapse of USSR, many visits have taken place from both sides. In November 1998, Lok Sabha speaker, Shri G. M. C. Balayogi, visited Russia. This visit provided another high point in our bilateral relations. During the visit it was decides to establish “India-Russia parliamentary Commission”

8 Defence Relations

India and Russia began a meaningful defence cooperation in the early 1960s, which became central element of their growing strategic partnership subsequently. By the mid-1960s Russian military hardware supplies to India, surpassed that of the US. Changes in the global scenario as well as domestic political developments brought corrections in the Soviet policy towards South Asia. By the end of 1960s, the Soviet establishment was fully convinced that India was its most reliable and natural partner in Asia. The USSR was consistently the key source of military hardware to fulfill India’s defence requirements. Since the 1970s, “the Indian military has been dominated by Russian equipment with the share of Russian origin hardware peaking at 80% by the end of the Soviet period”.

9 Joint venture

On one hand India purchases weapons and other defence equipment from Russia, and on the other hand defence industries of both the countries are intending to go for a range of “Joint projects”. The “Joint Venture” projects have yielded excellent results. Some of such projects are as under:

1. BrahMos

In 1998, India & Russia signed the most prominent deal to jointly design, develop, and manufacture “Supersonic Tactical Cruise Missile” by establishing a Joint “BrahMos Aerospace”. “The BrahMos missiles incorporate advanced Russian technologies, which Moscow has not made available to China or any other country but built in India”. The BrahMos missile can be launched from air, land and sea platform. This would enable India to build a fast flying cruise missile with a speed of about Mach 2.8 (more than 2000 miles per hour). The missile can sustain conventional warhead of 300Kg and has 290 Km range. Targets from a very low altitude, such as 10 meters, can be engaged by this missile. Tomahawk is a very high tech US cruise missile and BrahMos is three times faster than it. This makes BrahMos one of the fastest cruise missiles in the world.

The supersonic BrahMos cruise missile started to enter the armed forces of India in 2005. Land and sea trials have been successfully conducted. Test firing of “BrahMossupersonic cruise missile” from INS Kolkata, the latest stealth destroyer, in the Arabian Sea by Indian Navy was successful. Two more warships (INS Kochi and INS Chennai) like INS Kolkata are being equipped with the universal vertical launched BrahMos missile system as their principal precision strike weapon. 108 According to the Director of BrahMos Aerospace, the Indian Air Force will start using the SU-30 MKI with BrahMos missiles in the year 2016. 23

The BrahMos is the only operational supersonic cruise missile in the world, and other countries are making efforts to obtain such a missile. It is an example of what we can achieve when we cooperate with each other. The BrahMos became operational in the Indian Military in 2006. This would enable India & Russia to develop weaponry required by Russia to get back the world power or super power status. A new variant, the “BrahMos-II should be ready for flight tests by 2017, with a capability of flying at higher speed of Mach 5 to Mach 7”.

2. Multirole Transport Aircraft

The success of BrahMos Aerospace Project provided the necessary impetus to both sides to explore newer vistas for joint design and development of other military hardware. A contract to develop 205 “Multirole Transport Aircraft (MTA)” was signed in May 2012. “United Aircraft Corporation (UAC) Transport division” from Russia and “Hindustan Aeronautics Limited (HAL)” from India agreed to form a Joint Venture, in which both will invest $300 million each. Both the companies, along with their joint venture firm, “Multirole Transport Aircraft Ltd (MTAL)”, signed the venture deal. Out of 205, 45 planes will be given to “Indian Air Force”, and 100 planes to “Russian Air Force”.24 Balance 60 planed can be sold to other countries. “Capable of flying a range of 2500 Km at a maximum speed of 800 Km/hour, MTA isofficially expected to be test-flown in 2017 with a serial production due to begin in 2019”. The Russian Air force will replace its Il-214 planes with new planes; and Indian Air Force will replace its AN-32 planes, which Russian will upgrade “under a separate contract worth almost $400 million”. The joint venture also aims to sell some planes for export. More worrisome, some Russian analyst doubt that it is still on the drawing board, and only 2025 it may make its maiden flight. By that time the project will become obsolete, “as MTAs major competitor Brazilian Embraer KC-390 has made significant progress in the development of the aircraft”.

3. The Fifth Generation Fighter Aircraft (FGFA)

The other major joint venture has been for developing a “Fifth Generation Fighter”, the T-50 or its Indian designation, the “Fifth Generation Fighter Aircraft (FGFA)”. This $35 billion project is designed to produce an aircraft analogous to the American F-22 Raptor. India was invited to become a partner in the development of the FGFA by Moscow in 2007, so that the Russian side could access both the Indian financial clout and certain niche capabilities that India had to offer, but there was ambiguity on “scope of work”. They were not clear who will develop what systems and components. Consequently, a “general contract for the joint venture” was negotiated from the “Inter-Government Agreement”. In 2010, a contract was signed. HAL thus came on board with the Sukhoi Company. The two companies already had experience of working together on the license production of the SU-30MKI. “Each side plans to invest $6 billion to co-develop plane in the project”. 114 HAL will additionally be responsible for designing the two seat version of the aircraft preferred by the Indian side. The T-50 Fifth Generation Jet will be “highly stealthy and highly maneuverable”. Its maximum velocity will go beyond 2000 Km/hour, it will have a range up to 5000 Km. The deal requires “Russia to procure 200 Single-seat and 50 Twin-seat aircraft, while India purchases 50 Single-seat and 200 Twin-seat aircrafts”.115 The T- 50 Fifth Generation Fighter would be developed by 2016

4 Space Cooperation

Space has been the most successful area of India Russia Cooperation. India & Russia has been conventionally collaborating in the field of aerospace for many years, and they agree to multiply their cooperation in the field. Over the years, Space Programme in India has been carried out with the help of high technology from the USSR. Carrying forward this traditional cooperation, Russia & India have undertaken numerous “high-technology space projects” under the “2004 Inter-Governmental Agreement on Cooperation in the area of exploration and use of outer space for peaceful purposes”. The Unmanned Lunar Probe launched by India in 2008, name as Chandrayaan-I, was jointly developed by the “Indian Space Research Organization (ISRO)” and the “Russian Federal Space Agency (RFSA or Roscosmos). Russia & India are now working “Chandrayaan-2 project”, a follow up project of the earlier one that will have the moon orbiter, lander and rover module. Development work will be done partly by India and partly by Russia. As per agreement between ISRO and Roscosmos, India will be developing two modules, the moon orbiter and rover, and Russia will develop the third module called moon lander. Discussions between scientists of two countries have taken place to decide on “various interfaces and mission related operations”. Chandrayaan-2, India’s 2nd moon mission is expected to be launched by 2016 or 2017. Russia has also been helping India since 2008, in developing the “Human Space Flight Project (HSP)”. This project is of “key strategicpriority” for India, in which crew will be carried to low Earth Orbit. Since 2007, India & Russia have also been collaborating on the developing “Youthsat”. On 20th April 2011, the “jointly developed Indian-Russian Student Satellite (Youthsat) was successfully launched by India on a PSLV rocket”. Information regarding solar flares and their influence on upper atmosphere of the Earth will be collected by this spacecraft. Youthsat is a joint Indo-Russian atmospheric satellite mission with the participation of students from universities to motivate the younger generation towards space research. Russia has expertise in this area; and moreover they are willing to share technology with India. This help has stimulated the indigenous space programme of India.

In 2004, when Russian President Putin visited India, a space related agreement was signed by the two countries. This agreement was on “Cooperation in the Russian Satellite Navigation System – GLONASS”. Later on, many “follow up agreements on GLONASS” have been signed. The ongoing cooperation in Russia’s GLONASS project includes “joint development of satellites, launch of satellites, and joint manufacture of satellite navigation equipment for civilian user”.140 As per the agreement GLONASS Satellite will be launched with “GSLV Launch Vehicle of India”, and signals from the GLONASS system shall be available for use by India. The “Russian GLONASS” satellite network is similar to the “US Global Positioning System (GPS)”. These systems provide real time positioning and speed of the objects on surface, on sea; as well as airborne objects. 25

India has interest in GLONASS for its use in military equipment also. A large part of India’s military hardware has been purchased from Russia, and hence for navigation GLONASS would be more compatible with it. Keeping this in view, India would like to have greater stakes in GLONASS. In December 2011, the two countries signed a deal “for receiving precision signals from GLONASS, which would allow missiles, including those fired from nuclear submarine Chakra, to strike with in a meter of distant targets”. India has been using GLONASS technology for the last few years. When GLONASS opened its showroom in Mumbai in September 2012, its Deputy Chief Designer Igor Kuzetsov stated that “Indian citizens were already unknowingly using the Russian technology. The iPhone 4S supports GLONASS technology”. Cooperation between Russia and India in private sector received a boost on July 16, 2014 when an agreement for the manufacture of two space satellite was signed between Dauria Aerospace and Bangalore-based Aniara Communications. “Dauria Aerospace” is a “multinational aerospace company”. This company develops small satellite constellations and provides global satellite based remote sensing information service to its clients. By using lower cost satellite and higher performance satellites, the company provides Earth imaging data and communication services directly to its customers.

Aniara supports global telecommunication and high technology enterprises. It has offices in the US and Bangalore. According to Aniara president Raghu Das, “Small satellites are an ideal solution if there is the lack of the needed volumes of satellite communication and broadcasting that India has at present”23

Roscosmos, the space agency of Russia, is looking up to establish a joint venture with India to produce equipments for GLONASS. In addition to placing ground stations in the country, Roscosmos is also planning fourth GLONASS navigation equipment being manufactured in India. GLONASS has total of 29 satellites in orbit. Out of them 24 are active and provide global coverage. 4 satellites act as backups; and the remaining one undergoes test flights. In addition to using the GLONASS services for the past few years, India is now developing its own “Indian Regional Satellite Navigation System (IRNSS)”. It will have a “constellation of 7 satellites which willbe placed in the geostationary orbit to give maximum coverage of India and its neighbours”. 26

Space cooperation between India & Russia has been continuing by establishing Joint Ventures. This arrangement has provided numerous prospects for future space projects. Both India & Russia should work collectively for “deep space mission” and the “Mars mission”. This could provide a “significant step in space and technological cooperation

10 Cooperation in the Oil sector

India-Russia annual summit was held in New Delhi on December 11, 2014, during which an agreement was signed by Russian oil company Rosneft Corporation, which will deliver 10 million tonnes of oil to India, annually for 10 years. This, of course, will not satisfy all the needs of India, but will allow hedge against situations like the one that occurred in 2012. Then, under pressure from the US, India was forced to reduce oil imports from Iran, which led to higher prices not only for fuel, but also for all consumer products. In the field of oil 25

exploration, most of the land deposits in Russia seem to have been explored. Hence new field can now be explored on the shelf. Russian state-run company Rosneft has offered two fields for Joint Exploration, and India’s ONGC Videsh Limited (OVL) is looking for the Magadan 2 and Magadan 3 shelf projects in the Sea of Okhotsk 27

11 Conclusions

Except for a very brief period in the early 1990s, India’s relations with Russia have been based on mutual trust and confidence. In the mid-1990s relations were restored to respectable levels which have been further strengthened since the signing of their ‘strategic partnership’ in 2000. Currently, the main pillars of this relationship are strategic congruence, defence ties, nuclear power and hydrocarbons. The trouble for Indian policy-makers is that these areas still remain skewed in favour of Russia.25 The major challenge for both India and Russia is how to sustain this relationship in the absence of dynamic commercial ties. Future bilateral economic relations will depend on Russia’s importance to India’s developmental needs and vice versa. In the past, the USSR played an important role in India’s industrialization process. It had a comparative advantage in sectors like steel, which was central to its needs. India now has to assess where Russia has a comparative advantage. So far, India has been able to develop linkages in defence production, the oil and gas sector and in nuclear energy. Indian industry has already identified areas of mutual interest, namely information technology, pharmaceuticals, telecommunications, financial services, hydrocarbons, energy and power, oil and gas, food processing, financial consultancy, management services, textiles and diamond processing. The problems are well known, however, including lack of information, visa problems and logistical issues. Still, very little attempt has been made to address these issues. There was a lot of hope that a Eurasian north–south trade corridor would be able to tackle some of the transportation problems. Owing to low trade volumes, however, the trading community has not yet developed this route. The strong political will in both countries to improve bilateral economic relations could have been converted into real economic gains if some imaginative initiatives had been taken, particularly when the Russian economy was booming between 2000 and 2007. With the global economic slowdown impacting in 2008/09, things have become more complicated for increasing India-Russia economic links, with trade declining from $5,420m. in 2008/09 to $4,550m. in 2009/10. Current Indo-Russian commercial relations are certainly not commensurate with existing potential. In the last few years India has signed bilateral trade deals with many partners and many are under negotiation. However, until Russia joins the World Trade Organization (WTO), it is highly unlikely that India and Russia will be able to sign any significant bilateral trade and economic co-operation agreements. In the last two decades the Indian and Russian economies have moved far from each other. With no major breakthrough, Indian and Russian economic ties will continue to depend on the arms trade, and nuclear and energy industry linkages. Russian exports to India are likely to be from the extraction industries and limited Indian exports will continue to be from low-volume, high-value and high-profit sectors. It is clear now that defence ties constitute the core of bilateral relations. Russia has provided the most advanced aircrafts, tanks, rocket launchers, missiles, frigates and submarines to India. Through licensed production of arms, missiles and aircraft, India is slowly developing its own defence industry. There have been problems in defence supplies concerning product support, cost escalations, delays in delivery and incomplete transfers of technology. Still, substantial arms imports continue to come from Russia. With a changing foreign policy orientation in India, the importance of arms imports from Russia may see a declining trend in coming years. There was some uneasiness in Russia when India signed a Strategic Partnership with the USA in 2006, and there was talk of Russia being elbowed out as India’s main arms supplier, particularly in the midst of troubled negotiations during 2008–10 over the sale of the Admiral Gorshkov aircraft carrier. Nevertheless, overall Russia remains an important factor in Indian foreign policy debates. Moreover, at the broadest level, the Indian elite believes that a strong Russia is important for maintaining a desired international equilibrium, both supporting the idea of multi-polarity and a rule-based international system, within which India can continue its rise. This remains India’s basic ‘strategic synerg

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Ashutosh Gupta