India and Russia to tap full potential of economic relationship

The Indian Ministry of External Affairs said in a statement that the 24th India-Russia Inter-governmental Commission on Trade, Economic, Scientific, Technological and Cultural Cooperation was held in New Delhi on April 17-18. Both the countries agreed to unlock full potential of bilateral trade and economic relationship.

Indian External Affairs Minister S. Jaishankar and Deputy Prime Minister and Minister of Trade and Industry of Russia Denis Manturov, who arrived in Indian capital Monday heading a high-level delegation comprising senior officials from several Russian ministries, co-chaired the 24th session of the Inter-governmental commission.

The Inter-governmental Commission, which is a mechanism for monitoring bilateral progress of trade and economic cooperation between the two countries, agreed to address the trade deficit and market access issues.

The visiting Russian deputy PM also met Indian Commerce and Industry Minister Piyush Goyal, Finance Minister Nirmala Sitharaman and National Security Advisor Ajit Doval.

The India-Russia Business Dialogue was also held on Monday with participation of key businesses from both the countries enabling Jaishankar, Manturov and business leaders to engage and drive the momentum of shared priorities of deeper and wider bilateral commercial cooperation.

Though Indian authorities claim that the visit is in continuation of the regular high-level dialogue between the two nations, it assumes greater importance as New Delhi’s closer ties with Russia even while the latter is engaged in a bloody battle in Ukraine is seen with caution in western capitals.

India has so far resisted Western pressure to condemn Russian aggression and instead expressed concern over the humanitarian crisis arising out of the war and called to resolve all differences through dialogue and diplomatic means.

Jaishankar has said that discussions are on over the payments issue with Russia, referring to the trade in local currencies (rupee-ruble).

“There are discussions on the payments issue under the scheme of international trade settlement in Indian rupees through the special rupee vostro account system.

“And I think the payments issue clearly needs to be worked through between our systems. It is something we will be discussing,” said Jaishankar at the India-Russia Business Dialogue.

The event was organized by the Ministry of External Affairs in partnership with FICCI and the Business Council for Cooperation with India (BCCI). India and Russia have a Special and Privileged Strategic Partnership.

“For the period between April 2022 and February 2023, bilateral trade was about $45 billion and is expected to grow,” Jaishankar added.

Russia has said that within the framework of the inter-governmental dialogue, they propose to consider the possibility of the wide use of national currencies.

Meanwhile, Russia also wants to take its partnership with India to another level by having a Free Trade Agreement (FTA).

“Together with the Eurasian Economic Commission, we are looking forward to intensifying negotiations on the FTA with India.

“Additionally, we are working on signing the Russia-India Bilateral Agreement for the Promotion and Protection of Investments,” said Manturov.

To protect the principles of free trade, Russia has undertaken a set of measures which includes permitting import of original goods without consent of the rights’ owners from unfriendly countries — so-called parallel imports.

“Besides, we’ve launched the program of preferential loans and insurance of Russian importers towards procurement of priority products from foreign countries.

“Among the most demanded goods under this program are components and equipment for road construction, products of chemical and pharmaceutical industries. I am sure that this will create opportunities for Indian companies to increase their supplies to Russia,” Manturov added.

Russia has also invited Indian companies who are keen on joint projects to consider ‘cluster investment platform’.

“This provides preferential credits for designing and manufacturing of priority products, subsidies for pilot batches of goods, insurance premium and income tax preferences.

“As far as certain components and technologies are concerned we will definitely rely on trusted foreign partners. We are working in this manner with our Indian friends for decades,” Manturov added.

Marupov also met National Security Advisor Ajit Doval and discussed a wide range of issues under the India-Russia Strategic Partnership.

UAE-India hold talks to finalize rupee dirham trade deal

The United Arab Emirates (UAE) and India are in technical discussions to finalize rupee-dirham exchange rate for trade arrangement. This was told by UAE ambassador to India, Abdulnasser Jamal Alshaali to Hindustan Times newspaper. 

“The technical conversation is ongoing. There has been an agreement to settle a certain [amount] of trade between the two countries, just not having to go through a third currency,” he said, adding the two sides are working on a remittance facility to make it "more direct and easier".

Alshaali noted that energy security is important for both countries with the UAE seeking to be part of India’s energy security.

“The fact that the strategic oil reserve has been agreed on and it’s been established and has been ongoing for quite some time, it is quite helpful and constructive, especially given the current state of affairs,” he added.

The ambassador said that India is a reliable partner for the UAE’s food security.

“Food security is important for us. We don’t produce that much food and we import a lot of it. And it’s quite vital for us that we have a partner that we can rely on, and India is a reliable partner when it comes to that,” Alshaali noted.

 

Logistic issues limiting Tehran Dhaka trade

Gholam-Hossein Shafeie, Head of Iran Chamber of Commerce, Industries, Mines and Agriculture (ICCIMA), has said tariff barriers and transportation problems are the main factors that are hindering Iran-Bangladesh trade relations.

Shafeie made the remarks in a meeting with Iran's new Ambassador to Dhaka Mansour Chavoshi in Tehran. Chavoshi, who has been newly appointed as Iran’s envoy in Bangladesh, visited ICCIMA to discuss ways to strengthen trade and increase the volume of trade exchanges between Iran and Bangladesh, before leaving Tehran for his mission.

During the meeting, Shafeie mentioned Bangladesh’s acceptable economic growth in recent years and assessed the future economic prospects of the country as positive. He emphasized the need to improve the trade infrastructures of the two countries for the development of mutual cooperation.

The ICCIMA Head further pointed to common areas for economic cooperation such as transportation, construction materials such as bitumen and cement, fuel, investment, clothing and textile, agriculture, herbal medicines, and medical devices, saying that the two sides should take all the necessary measures to benefit from these capacities.

According to Shafeie, Bangladesh has established tariff exemption treaties with some countries including the members of the European Union, and therefore, in order to facilitate trade with the Islamic Republic, it is necessary to implement a similar preferential trade agreement that has already been approved by the two countries.

Referring to the recent trip of an Iranian trade delegation to Dhaka to participate in the meeting of the chambers of commerce of the D-8 organization, he said, “This delegation discussed cooperation programs, including the reduction of trade tariffs and the cancellation of business visas among the members of this organization. It was also announced that the next round of the meeting of the D-8 Chambers of Commerce would be held in Tehran, and it was welcomed by other chambers.”

“One of the measures that the ICCIMA has had on its agenda was the formation of a joint Iran-Bangladesh trade committee, which fortunately was approved by the chamber's board of directors this week, and this committee will be formed soon,” he announced.

Chavoshi for his part emphasized the importance of Iran-Bangladesh relations and pointed to the great advantages that Iran can benefit from cooperation with this country.

“One of the positive factors in cooperation with Bangladesh is the fact that the people of this country have a very good attitude towards Iranian goods and the country’s businessmen, and this can be built upon to strengthen and develop relations between the two countries,” the envoy said.