NEW DELHI: As India plans to take a step forward towards free trade agreement (FTA) talks with the Moscow-led Eurasian Economic Union (EAEU), both countries are in active dialogue to address several non-tariff issues, confirmed a source from the Ministry of Commerce.
From listings to complex certification and testing requirements, Indian exporters continue to face challenges while tapping the Russian market.
The source also confirmed that Russia has shown keen interest in having an FTA and thus, both the sides are speeding up the discussions. India is pushing hard for resolving the non-trade issues without which there is minimal chance of increased trade even if a deal is done.
“The challenges include listing, certain compliance requirements and also obtaining approvals for agricultural and marine processing or export facilities,” said an official aware of the matter.
India has identified over 65 non-tariff measures affecting its trade with Russia, primarily in areas of marine and agricultural exports. Key issues include approval of export units for products like shrimp, as well as other certifications and streamlined procedures needed to export goods.
The Federation of Indian Export Organisations (FIEO) also identified complex certification and testing requirements , language and documentation barriers, limited market access for agri and pharma products and financial and payment issues as some of the major non-tariff issues affecting Indian exporters aiming to tap the Russian market.
“Russian authorities often mandate conformity with local (EAEU) standards, even for globally certified products. Also, all product documentation, packaging, and manuals must be in Russian, creating additional compliance cost,” said S C Ralhan, President, FIEO.
He also asserted that due to sanctions, there are restrictions on payments, banking channels, and currency conversion risks. Also non-recognition of Indian standards for several products in the agri, pharma sector has become particularly challenging.
With increasing numbers of Vostro accounts, India is looking for avenues to tap the export market in Russia, else the trade deficit between the two countries will continue to grow.
India’s trade deficit with Russia has grown by more than 3.6% from $56.89 billion in 2023-24 to $58.96 billion in 2024-25 as imports rose to $63.84 billion from $61.159 billion, with exports remaining below $5 billion.
India and the Eurasian Economic Union signed the terms of reference to launch FTA negotiations in August.
