India is pushing for long-term trade and investment relations with Russia as the leaders of the two countries met on Thursday ahead of the BRICS Summit.
Indian Commerce Minister Piyush Goyal, who met Russian Minister of Industry and Trade Anton Alikhanov on Thursday, highlighted that Russia is tapping only a small portion of India’s potential as a trade partner. He said Russia is a significant importer of many goods and India is a significant exporter of those goods globally, but India is not yet a significant exporter to Russia.
Goyal urged Russian firms to manufacture in India rather than just sell, pitching investment-ready national industrial corridors with plug-and-play infrastructure.
Speaking on the sidelines of the India-Russia Business Dialogue, exporters said Russia offers significant opportunities for Indian exporters, particularly as some of its traditional supply chains have been disrupted or constrained. As a result, Russian businesses are increasingly looking towards India for a much wider range of products.
Ajay Sahai, director general and CEO of the Federation of Indian Export Organisations (FIEO), said, “The opportunity and demand are clearly there, but the key challenge is our ability to address some of the supply-side constraints and translate this demand into actual exports.”
He pointed out that with European shipping lines being closed, logistics have become a major challenge for exporters. Several major international shipping lines have limited operations involving Russia, while the available Russian shipping capacity is relatively limited and more oriented towards commodity trade.
“Improving connectivity, including dependable shipping arrangements and alternative transport corridors, will therefore be critical for scaling up India’s exports to Russia,” Sahai added.
Indian exporters have also flagged that Russian buyers turn to India only when there is a disruption in their supply chains and they face challenges in sourcing supplies from other countries. According to exporters, Indian companies in sectors such as dairy, marine products and pharmaceuticals have faced delays in obtaining the necessary registrations and approvals in Russia.
Pitching connectivity and smoother currency payments over tariffs, Goyal urged visiting Russian firms to seal at least one deal before leaving Delhi and diversify into non-energy sectors such as pharmaceuticals, auto parts and agri-tech.
Sahai said India is also exploring innovative solutions such as establishing Indian warehousing facilities in Russia. A warehouse with customs-cleared inventory can enable Indian exporters to respond quickly to customer requirements, reduce delivery times and provide greater confidence to Russian buyers.
