The trade relationship between Russia and India has been experiencing significant growth in recent years, with bilateral payments proceeding smoothly without the usual glitches that have been plaguing trade with other countries. This flourishing partnership is underpinned by robust economic cooperation and mutual trust between the two nations.
Russia’s trade with India nearly doubled to $65 billion in 2023, with the country emerging as a major importer of Russian oil following Western sanctions in 2022 over the Ukraine conflict. This surge in trade is a testament to the resilience and adaptability of both economies in the face of external challenges.
Anatoly Popov, deputy CEO of Russia’s largest lender, Sberbank, revealed that the bank handles payments for up to 70% of all Russian exports to India. Despite being under Western sanctions, Sberbank has not encountered any obstacles in conducting transactions in India, thanks to the country’s friendly stance towards Russia.
Transactions between Russia and India in roubles and rupees are proceeding seamlessly, with 90% of them being completed within hours. This efficiency stands in sharp contrast to dealings with other partners like China. The growth in Indian exports to Russia has helped alleviate the issue of rupee surplus held by Russian companies, paving the way for a more balanced trade relationship between the two nations.
Sberbank is expanding its range of financial instruments, including forwards, options, and rupee-denominated loans for Russian companies at competitive rates. The bank is also grateful to Indian regulators for allowing operations through rupee-denominated “vostro” accounts, facilitating smoother transactions and enhancing operational efficiency.
Looking ahead, there are vast opportunities for further strengthening the trade relationship between Russia and India. Popov emphasized the need for India to increase its exports to Russia significantly to achieve a more balanced trade flow. With India’s status as a self-sufficient economy capable of meeting diverse needs, there is immense potential for continued growth and collaboration between the two nations.
The burgeoning trade relationship between Russia and India underscores the importance of nurturing strong partnerships based on mutual respect and economic cooperation. As both countries navigate the complexities of the global economic landscape, their shared commitment to bolstering trade ties bodes well for sustained growth and prosperity in the years to come.