{"id":51860,"date":"2025-08-21T21:13:41","date_gmt":"2025-08-21T15:43:41","guid":{"rendered":"https:\/\/www.nextias.com\/ca\/?p=51860"},"modified":"2025-08-23T12:42:25","modified_gmt":"2025-08-23T07:12:25","slug":"india-russia-deepen-partnership-amid-us-tariffs","status":"publish","type":"post","link":"https:\/\/www.nextias.com\/ca\/current-affairs\/21-08-2025\/india-russia-deepen-partnership-amid-us-tariffs","title":{"rendered":"India-Russia Deepen Partnership Amid US Tariffs"},"content":{"rendered":"\n<p><strong>Syllabus: GS2\/IR<\/strong><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Context<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>India\u2019s External Affairs Minister visited Moscow for the 26th Session of the India\u2013Russia Inter-Governmental Commission on Trade, Economic, Scientific, Technological and Cultural Cooperation (IRIGC-TEC).<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>About<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>EAM is on a three-day visit to Russia, taking place against the backdrop of <strong>strained India-US relations following tariffs on Indian goods.<\/strong><\/li>\n\n\n\n<li>The visit comes amid the possibility of a meeting between Prime Minister Modi and the Russian President during the SCO Summit in Tianjin, China.&nbsp;<\/li>\n\n\n\n<li>Additionally, discussions are ongoing about a potential visit by the Russian President to India later this year.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Agenda &amp; Proposals<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Aim:<\/strong> To strengthen the trade partnership and address the $58.9 billion trade deficit resulting from India&#8217;s increased oil imports from Russia.&nbsp;<\/li>\n\n\n\n<li><strong>Addressing barriers: <\/strong>Removal of tariff &amp; non-tariff barriers.<\/li>\n\n\n\n<li><strong>Connectivity boost: <\/strong>Boosting regional connectivity through major routes, the International North-South Transport Corridor (INSTC), Northern Sea Route, Chennai\u2013Vladivostok corridor.<\/li>\n\n\n\n<li><strong>Trade diversification: <\/strong>Streamlining payment mechanisms, early conclusion of India\u2013Eurasian Economic Union (EAEU) FTA.<\/li>\n\n\n\n<li><strong>Business engagement:<\/strong> More intensive B2B contacts; encourage Russian companies to invest in Make in India opportunities.<\/li>\n\n\n\n<li><strong>Strategic Targets:&nbsp;<\/strong>\n<ul class=\"wp-block-list\">\n<li>Revised trade target of USD 100 billion by 2030.<\/li>\n\n\n\n<li>Strengthening of Special and Privileged Strategic Partnership.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Major Concern of India&nbsp;<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Increased Trade Imbalance:<\/strong> In the last four years, India\u2013Russia trade in goods has surged from USD 3 billion in 2021 to USD 68 billion in 2024\u201325, but the trade deficit has also widened sharply from USD 6.6 billion to USD 58.9 billion.<\/li>\n\n\n\n<li><strong>Trade Balance &amp; Market Diversification:<\/strong> US is one of India\u2019s largest export destinations, higher tariffs could worsen India\u2019s trade deficit with the US unless India finds alternative markets.<\/li>\n\n\n\n<li><strong>Energy Security Pressure: <\/strong>Additional 25% penalty on Russian oil purchases directly impacts India\u2019s strategy of securing affordable energy imports, it may force India to pay higher prices for non-Russian oil, affecting inflation and current account balance.<\/li>\n\n\n\n<li><strong>Diplomatic Strain in Strategic Partnerships:<\/strong> Tariffs undermine the India\u2013US Strategic Partnership, especially in the context of:\n<ul class=\"wp-block-list\">\n<li>QUAD cooperation (Indo-Pacific).<\/li>\n\n\n\n<li>Defence technology and co-production.<\/li>\n\n\n\n<li>Semiconductor and critical tech collaboration.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Risk of Trade Wars:<\/strong> India might be pushed to retaliate with counter-tariffs, risking an escalating trade war.\n<ul class=\"wp-block-list\">\n<li>Could disrupt India\u2019s broader goal of positioning itself as a reliable global trade hub.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>How India\u2013Russia Partnership Can Help India Overcome US Tariff Challenges?<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Energy Security and Cost Advantage: <\/strong>Russian crude oil imports at discounted rates help India keep its energy basket stable despite US penalties.\n<ul class=\"wp-block-list\">\n<li>This reduces import costs, controlling inflation and giving exporters a competitive edge against higher US tariffs.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Market Diversification:<\/strong> Russia (and the wider Eurasian region) offers alternative markets for Indian exports reducing over-dependence on the US.\n<ul class=\"wp-block-list\">\n<li>The proposed India\u2013Eurasian Economic Union (EAEU) FTA can provide preferential access to a large market across Russia, Belarus, Armenia, Kazakhstan, and Kyrgyzstan.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Connectivity &amp; Logistics Advantage: <\/strong>Projects like the <a href=\"https:\/\/www.nextias.com\/ca\/current-affairs\/14-06-2022\/international-north-south-transport-corridor-instc\" data-type=\"link\" data-id=\"https:\/\/www.nextias.com\/ca\/current-affairs\/14-06-2022\/international-north-south-transport-corridor-instc\">International North-South Transport Corridor (INSTC)<\/a>, Chennai\u2013Vladivostok maritime corridor, and Northern Sea Route can reduce transport time and costs for exports to Europe and Central Asia. This offsets the loss of competitiveness caused by US tariffs.<\/li>\n\n\n\n<li><strong>Trade in National Currencies &amp; Payment Mechanisms:<\/strong> Strengthening rupee\u2013ruble settlement systems shields India from dollar-dominated trade restrictions imposed by the US.<\/li>\n\n\n\n<li><strong>Defence &amp; Strategic Tech Cooperation: <\/strong>Russia continues to be a key supplier of defence technology and nuclear energy cooperation, areas where the US could impose restrictions.\n<ul class=\"wp-block-list\">\n<li>Strong ties with Russia ensure India maintains strategic autonomy and is not dependent on the US for critical technologies.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Industrial &amp; Manufacturing Opportunities: <\/strong>Russia\u2019s raw material exports (energy, fertilizers, metals) combined with India\u2019s manufacturing base can foster joint ventures under \u201cMake in India.\u201d\n<ul class=\"wp-block-list\">\n<li>This creates new value chains that reduce reliance on Western-dominated supply networks vulnerable to tariffs.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Strategic Balancing in Geopolitics:<\/strong> Deepening the Special and Privileged Strategic Partnership with Russia sends a signal to the US that India has viable alternatives.\n<ul class=\"wp-block-list\">\n<li>This can improve India\u2019s negotiating position in seeking tariff relief from the US.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Conclusion<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The India\u2013Russia partnership provides India with energy security, market diversification, and strategic autonomy at a time of tariff and geopolitical pressure from the US.&nbsp;<\/li>\n\n\n\n<li>By leveraging Russian ties, India can reduce vulnerability to American trade restrictions while continuing to pursue its long-term trade target of $100 billion with Russia by 2030.<\/li>\n<\/ul>\n\n\n\n<p><strong>Source: <\/strong><a href=\"https:\/\/www.thehindu.com\/news\/national\/in-moscow-jaishankar-raises-challenge-posed-by-tariff-to-india-russia-trade-calls-for-early-conclusion-of-india-eurasian-economic-union-fta\/article69957386.ece\" rel=\"nofollow noopener\" target=\"_blank\"><strong>TH<\/strong><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<h3><strong>Context<\/strong><\/h3>\n<li class=\"ms-5\">India\u2019s External Affairs Minister visited Moscow for the 26th Session of the India\u2013Russia Inter-Governmental Commission on Trade, Economic, Scientific, Technological and Cultural Cooperation (IRIGC-TEC).<\/li>\n<p><\/p>\n<h3><strong>About<\/strong><\/h3>\n<li class=\"ms-5\">EAM is on a three-day visit to Russia, taking place against the backdrop of strained India-US relations following tariffs on Indian goods.<\/li>\n<li class=\"ms-5\">The visit comes amid the possibility of a meeting between Prime Minister Modi and the Russian President during the SCO Summit in Tianjin, China.\u00a0<\/li>\n<li class=\"ms-5\">Additionally, discussions are ongoing about a potential visit by the Russian President to India later this year.<\/li>\n<p><a href=\"https:\/\/www.nextias.com\/ca\/current-affairs\/21-08-2025\/india-russia-deepen-partnership-amid-us-tariffs\" class=\"btn btn-primary btn-sm float-end\">Read\u00a0More<\/a><\/p>\n","protected":false},"author":15,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[21],"tags":[],"class_list":["post-51860","post","type-post","status-publish","format-standard","hentry","category-current-affairs"],"acf":[],"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/51860","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/users\/15"}],"replies":[{"embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/comments?post=51860"}],"version-history":[{"count":3,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/51860\/revisions"}],"predecessor-version":[{"id":51910,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/51860\/revisions\/51910"}],"wp:attachment":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/media?parent=51860"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/categories?post=51860"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/tags?post=51860"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}