«New Delhi will not turn its back on Moscow, although there is fear of sanctions»
Two years ago, when Russia actually lost Western markets, India, an ancient civilization with a population of one and a half billion and the sixth largest in the world in terms of GDP, became a saving oasis for it, along with China. In a matter of months, Moscow’s business ties with this amazing country, the new economic center of Asia, entered an unprecedentedly high orbit. And today, despite serious political pressure from the West, India remains a strategic trading partner of the Russian Federation, ready to buy oil, gas, fertilizers, and grain from us. However, the potential of this partnership has not yet been truly revealed – what “MK” told about Head of the Center for the Indian Ocean Region of the IMEMO RAS, Candidate of Historical Sciences Alexey Kupriyanov.
— They have changed radically. Before the start of the CBO, our trade turnover for many years did not go beyond $11 billion, and only after the pandemic, in the wake of the spontaneous restoration of trade relations, did it finally reach $12 billion (not a particularly impressive increase, given dollar inflation). And by the end of this Indian financial year (March 31, 2024) it will obviously be about $65 billion. In fact, it is more: the fact is that part of the trade turnover (according to our estimates, $5-8 billion) is hidden in the “gray zone” ;. Indian businessmen, fearing to fall under secondary sanctions, conduct operations through third countries (Iran, UAE), as a result, in fact, several billion of our trade turnover with India formally passes through other columns.
But the main thing – The structure of trade itself has changed. If previously weapons played a big role in it, now the growth in trade turnover is primarily due to the growth in export supplies of Russian oil. However, although we currently have a monstrous trade imbalance, there are positive signals – Thus, over the past year, imports of mechanical engineering products from India to Russia have doubled. We are now witnessing an emergency restructuring of the entire world trade system, and some parts of it (for example, the export of resources) are clearly being restructured faster than the import of finance and technology. Gradually, this imbalance, if it does not disappear, will become less noticeable.
— India traditionally and consistently opposes unilateral sanctions, recognizing (and even then, mainly formally) only sanctions imposed by the UN Security Council. Moreover, Delhi is well aware that trust and respect are gained over decades and centuries, but can be lost in an instant. If India, despite US pressure, did not break off relations with Saddam Hussein at the time; if, despite US sanctions, it did not abandon its nuclear program and ultimately tested a nuclear bomb, thereby entering the nuclear club; Finally, if India, despite the threat of sanctions from Washington, did not terminate the contract for the supply of S-400, what makes you think that it will turn its back on Moscow right now? The Indian leadership is extremely pragmatic, and the country's political elites are well aware that the United States is no less, if not more, interested in cooperation with India than India is – in cooperation with the USA.
Indian elites see the world differently than Western elites. They believe that it is beneficial for Delhi to cooperate with both Moscow and Washington at the same time. And the side of the conflict that tries to put pressure on India to win it over to its side will make a mistake, because Indians do not like to be pressured into doing something that, in their opinion, is contrary to their national interests. Yes, there is a danger that in the future India will abandon such a balanced policy and move to the American camp, but this requires a complete change in the consciousness and ideas of its political elites. The current generation of leaders is unlikely to do this.
— Now our trade resembles a pump that pumps much more in one direction than in the other. India, along with China, Turkey, Singapore and the UAE, buys a huge amount of our oil, and consumes only part of it, and sells the rest to the West. This situation will continue at least until the sanctions are either partially lifted or, conversely, tightened. In both cases, the current balance of interests will be upset, and the working scheme for pumping Russian resources will fail.
After this, obviously, our trade turnover will collapse as quickly as it grew – but the figure at which he will stop depends on how much our and Indian businesses have time to take advantage of this situation of chaotic uncertainty and establish new connections during this time. After the severance of trade ties with the West, we had difficulties obtaining a wide range of goods – from seeds to aircraft engines. India may well provide us with their supplies – both as a transit country and as a manufacturer. In the future, of course, it is necessary to create new production chains with the participation of Russian and Indian companies, and companies from third countries, but that is another story, which will most likely require changes to our domestic legislation.
— No, this is clearly not the main problem now. Firstly, there are relatively few rupees in the accounts of Russian exporters; secondly, alternative payment schemes have been established. I don’t think it makes sense to talk about them publicly and thereby make life difficult for domestic and Indian businessmen. I would say the main problem – this is the fear of Indian large and medium-sized manufacturers in general to deal with Russia due to sanctions. Moreover, as practice shows, literally the shadow of sanctions is enough for cooperation to break down – Indians will not delve into details; they will simply prefer not to take risks. Another problem is the reluctance of domestic businesses to invest in India. At the heart of these two problems is actually one – lack of knowledge about the Russian and Indian markets, the opportunities they provide, and the rules of the game. We, scientists, among other things, see our task as demystifying India for our compatriots, including business. We regularly speak at a variety of venues to talk about how India is structured, how it is governed, how its market and its business operate, what problems it faces, what challenges face India as a country and the Indian economy in particular.< /p>
— Firstly, I would be cautious about Bloomberg information, especially on issues of Russian-Indian relations. The news that Indian refineries do not accept oil from Sovcomflot tankers was given with reference to an anonymous source in the industry; there was no official or even semi-official confirmation. Considering how painful this issue is, a lot of options are possible – and the fact that Bloomberg reports unreliable information, and the fact that the Indians, by planting such anonymous information, are trying to gain time in order to reduce pressure from Western countries dissatisfied with the ongoing cooperation of India with Russia, and, finally, that the American agency is thus he is simply participating in an information campaign against Russia. But if this is true, then there is a set of solutions. And short-term ones, like creating a set of shell companies and purchasing used tankers for them that will sail under a flag of convenience, or pumping oil into the sea from sanctioned ships. And long-term, such as investments in the construction of terminals in the ports of India and neighboring countries.
— Yes, in the long term such a danger exists – for example, if Russia in the future decides to abandon its role as an independent player and become a vassal of China, or if India does the same with respect to the United States. How likely does the first option seem to you? Personally, it seems to me just as unlikely as the second one. If the leadership of both states maintains a course towards strategic autonomy (and manages to ensure the reproduction of new generations of elites who will realize the value of this autonomy and will not rush headlong to sacrifice their national interests for the sake of others, as has already happened in our history), then this risk can be mitigated minimize.
— There are and will always be notes of nostalgia – It is difficult to forget the role that Soviet-Indian friendship played during the Cold War. The Soviet Union helped India build heavy industry, Indians do not forget this. And you need to understand that the current Indian economic growth has become possible largely due to the fact that the country’s economy stands on this solid foundation. India, in turn, supplied the USSR with a wide range of consumer goods – from leather goods to tea. We also cannot forget about cultural interaction: those images of the Soviet Union and India that were formed half a century ago, if not earlier, turned out to be so strong that they even influence the perception of the younger generation.
But at the same time, it must be remembered that even in Soviet times, friendship between Russia and India was built primarily on sober calculation and the understanding that it had obvious value for both sides, and the embrace of the leaders was then poured into the buildings of the Bhilai plant and India’s political support for the Soviet initiatives at the UN. No one will be friends to their own detriment. Nowadays there is more pragmatism in relations at the highest level, and less personal nostalgia – also for completely objective reasons. The question is what will happen when the next generation of leaders, who were formed as individuals in the post-Soviet era, comes to power.
— Now the implementation of already concluded contracts continues, but the overall volume of cooperation has decreased for objective reasons: our weapons factories work primarily for the Northern Military District, and not for the foreign market. Other arms exporters are rushing to fill the vacated niches, but it is obvious that after the end of the SVO there will be a reverse wave: enterprises of the Russian military-industrial complex will return to the market, having a number of advantages – First of all, we are talking about already established production and battle-tested weapons. That is, we will be able to regain at least part of the lost positions, and possibly expand our presence on the global arms market.
In the case of India, the problem is different. India is now actively building a modern fleet, and in this area, unfortunately, we have little to offer it, and the Northern Military District only aggravates this situation, since the main efforts are aimed at increasing the combat capability of the army and aerospace forces, and not the navy. India needs technologies for the production of aircraft carriers, submarine detection systems, long-range maritime reconnaissance aircraft – and it appeals, for obvious reasons, primarily to the United States, and not to Russia. At the same time, the fleet still remains the most important military and political instrument, and after the end of the Northern Military District, Russia will have to actively rebuild it, taking into account the lessons learned during the conflict, develop and modernize it if it wants to remain a great power.