On the right track
Amb Kanwal Sibal

President Dmitry Medvedev’s recent visit to India has given fresh lustre to a relationship that had begun to lose its sheen. Indian political and economic circles, as well as the media, have been too obsessed with our developing ties with the US. The ties with Moscow received much less attention, even though Indian policy-makers and the public view Russia as a genuinely friendly country with which we have a stable relationship, good political understanding and a broad similarity of views on a range of international issues.

Our languishing economic ties with Russia means that in the Indian economic growth story Russia is largely absent. The most dynamic sectors of our economy are not looking at Russia for opportunities, but westwards for technologies and two-way investments. Efforts to promote economic cooperation by addressing bottlenecks through policy and administrative changes at governmental level and encouraging business-to-business ties have not produced meaningful results, because of the structure of the two economies, different priorities and delay in retrieving the loss of capacities in Russia following the Soviet Union’s collapse. Russia has also not been receptive enough to persistent Indian efforts to get a greater foothold in its energy sector.

The substantial Indo-Russian science and technology cooperation is not market-oriented as in the case of the US. Cultural contacts are not spontaneous, relying on government promotion through periodic cultural festivals. Educational and people-to-people ties in general have remained limited, although tourist flows have increased.

On the political side, Russia has supported removal of restrictions on international cooperation in India’s civilian nuclear sector and is the only country actually building power reactors in India. But this merit has got obscured by the US role in obtaining an exception for India in the NSG. Russia was the first country to support India’s permanent membership of the UNSC, but it is the equivocal US support that drew more applause. Russia lost credit for its gesture when, after initial unqualified support, it began diluting it by emphasising the need to build a large consensus for it.

In the defence area, India still receives top-of-the-line equipment from Russia, as well as access to sensitive technologies. Nevertheless, there have been problems with regard to adherence to delivery schedules, price escalation and inadequate product support, leading to calls for reducing our over-dependence on it and diversifying our sources of defence procurement. Until recently, Russia has believed political reliability, price advantage and technology access guaranteed its hold on the Indian market. But now with the expansion of the India-US defence ties, including important defence acquisitions, its concerns are mounting.

The US factor in the India-Russia relationship is being felt. The competition over the 126 multi-role combat aircraft — eyed by the Americans avidly — is a case in point. Lobbies in Russia that advocate improved ties and an arms supply relationship with Pakistan cite strengthening India-US defence ties, despite US military aid to Pakistan, besides the general argument why Russia should implicitly accept an Indian veto on Russia-Pakistan military deals.

Russia, like India, views terrorism and the return of the Taliban to power in Afghanistan as major security threats. While cognisant of Pakistan’s role in this regard, it avoids pronouncing on Pakistan’s involvement in terrorist activities against India. It wants to be seen as playing a constructive role in South Asia.

It is in this background that some results of Medvedev’s visit are striking. In the Joint Statement Russia reverted to its earlier unqualified support for India’s UNSC permanent membership. It gave backing to India’s membership of the NSG, MTCR and the Wassenaar Arrangement, leaving out the Australia Group, of which it is itself not a member. Most importantly, for the first time it joined India in asking for the perpetrators, authors and accomplices of 26/11 to be brought to justice expeditiously by Pakistan. Russia also noted jointly with India that states that aid, abet and shelter terrorists are as guilty of acts of terrorism as the actual perpetrators. It also asked for the elimination of safe havens and violent extremism in Afghanistan and Pakistan.

On the economic side, the important breakthrough is the Inter-Governmental Agreement in the hydrocarbon sector as it formally concretises Russia’s greater willingness to develop the energy relationship. In this connection the Framework Agreement between ONGC and Sistema, a private company looking for an Indian partner, holds promise. The idea of a Comprehensive Economic Partnership Agreement on which work has already been done has been revived, with a target of achieving a bilateral trade figure of $20 billion by 2015, which is realisable if MoUs in sectors like IT and ITES and pharmaceuticals, etc, are implemented. The long-discussed decisions to set up a new India-Russian S&T centre and joint R&D centres in Delhi and Moscow for commercialisation of joint research outcomes are positive initiatives. The joint venture integrated steel plant in Karnataka and agreements in the telecom sector, in which Russia’s Sistema is investing large sums, denote welcome Russian interest in our industrial and services sectors.

In space agreements on Glonass related services, and access to military signals from this Russian GPS system (of strategic importance) were signed. In the nuclear sector if the technical-commercial agreement on Kudankulam 3 and 4 had been signed, Russia would have got a headstart over others once again. But our civil nuclear liability legislation troubles the Russians too. They await clarifications, like the US and France, on the legal scope of the legislation as well as the envisaged period of liability, in the rules and regulations to be framed under the Act. An agreement on cooperation between nuclear research institutes was, however, signed. Of potential significance is the agreement to cooperate in third countries, given plans in our neighbourhood and elsewhere to set up nuclear power plants. Russia has recognised India as a supplier state for multilateral approaches to the nuclear fuel cycle in the IAEA, consolidating India’s position over the reality of its mastery over the full nuclear cycle. India and Russia signed the preliminary design contract for the Fifth Generation Fighter Aircraft, of which India would eventually acquire 200 to 250 in number, manifesting India’s commitment to a durable defence relationship with Russia even as we explore options with others.

Russia was the first country with which we established a strategic partnership. For it to graduate to a ‘special and privileged strategic partnership’ that the Joint Statement speaks of will need greater movement in the positive directions that President Medvedev’s visit has charted.

Article published in New Indian Express dated 5th January 2011

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