News 13 Feb 13 INDIA-RUSSIA BILATERAL SUMMIT

INDIA-RUSSIA BILATERAL SUMMIT

·         India-Russia ink 10 defence pacts worth $ 4 billion

·         They trumpet new partnership.

·         Putin raises Sistema issue during talks.

During Russian President Vladimir Putin's state visit to India in the last week of December 2012, several agreements were signed between the two countries. These include defence deals worth around $ 4 billion.

 (Rs. 22,000 crore) signed on Dec.24 following comprehensive talks, including on differences over $ 3 billion investment by Russian telecom major Sistema, whose licence was cancelled.

Mr. Putin and Prime Minister Manmohan Singh underlook an extensive review of bilateral cooperation, especially in the field of nuclear energy and discussed ways to expedite an agreement for nuclear reactor 3 and 4 at Kudankulam. All key bilateral issues, including defence, space, trade & investment, science and technology, education, culture and tourism were discussed in the meeting which also witnessed Russians raising their concerns over the issue of Sistema. Sistema, with investment of $ 3.1 billion, has 56.68% stake in Shyam Sistema Teleservices (SSTL) whose 21 out of 22 licences were cancelled by the Supreme Court on February 2 as irregularities were found in their allocation.

The Russian government, which has a stake of 17-14% in the company, has since been expressing concern and pressing India to ensure protection of Sistema's investments.

Russia and India also resolved to further extend their partnership in the energy sector, which has moved beyond investment (Sakhalin-I) to direct trade (Gazprom-Gail) and is now seemingly set for joint investment in downstream and upstream sectors. India put its interest areas on the table equity participation through ONGC—OVL in existing and new projects in Siberia, Russia's Far East and the Arctic Shelf besides interest in acquiring equity stake in discovered or producing assets and in proposed Liquefied Natural Gas (LNG) projects in Russia.

$ 2 billion Investment Consortium to be set up

 

Russian sovereign wealth fund Russian Direct Investment Fund (RDIF) on December 24, 2012 signed a pact with State Bank of India (SBI) for setting up a $ 2 billion investment consortium for promoting investments between the two countries.

The RDIF and SBI would each invest up to $ 1 billion in the consortium, a statement issued by the Russian sovereign wealth fund said.

The entities would team up to facilitate access to long term capital in Russia and India and actively promote mutual investments.

Bolstering Ties  

·         Russia will sell 71 military helicopters for $ 1.3 billion to India.

·         India will also get technological kits to assemble 42 Sukhoi jet fighters for $ 1.6 billion.

·         Russian sovereign wealth fund inks pact with State Bank of India for setting up a $ 2 billion investment consortium.